Key Man Insurance

Does your business depend heavily on one or more of its employees? A designer? The salesman who really understands the specialist product and the niche market? The multilingual engineer? You ?

And how would your business be coping if that key employee had died or been incapacitated a fortnight ago? Could it survive? What would it cost to select and recruit a suitable replacement? What about lost profits in the meantime?

We can advise on your Key Person assurance needs – how to work out what cover your business really needs, how to make sure the assurance is tax efficient, and what product is the most cost effective.

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More information on key man insurance >

More information on key man insurance

Key person insurance is essentially life insurance in a business context:

The life assured is the ‘key’ employee
The employer owns the policy
The proceeds are used to secure replacement services and/or defray expenses caused by loss of the key person’s services.

Because the insurance protects the interests of the business, premiums could be an allowable business expense. The key person’s co-operation is needed, as the provider will require his/her medical history as the basis for underwriting.

As well as insuring against the effects of the employee’s death, the policy can cover her/his critical illness.

Several formulae can be used to assess an appropriate sum assured – we can advise on which one most closely matches your needs (possibly suggesting a hybrid of more than one formula). How we advise will depend on what you are seeking to cover – the cost of replacing the employee, or the effect her/his absence might cause.

We will also take great care to point out all tax implications of the cover.

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