Key Person Life Insurance

Key person life insurance is purchased by a company on one of their "key" employees, in which the company is the beneficiary in the case of that employee's untimely demise. For example, let's say that a law firm had five attorneys on staff and one of those attorneys was responsible for 60% of the firm's business. Such an attorney would be considered a "key" person to the law firm because in his absence the business might fail or incur significant and unwanted loss of revenues.

Key person insurance is a very important but an underutilized business preservations strategy. Every business should consider key person insurance to make sure key staff losses would not jeopardize the survivorship of the organization.

Buy / Sell Life Insurance
Own a business with other owners? Who will purchase the company or the deceased partner's or shareholder's interest? What is a fair price and when will the sale be made? Will the family of the deceased owner be taken care of or assume the deceased partners ownership? These are very important questions every business partnership should consider.

Buy/sell insurance is one of the best ways to assure the continuation of your business the way you intended even if one of the partners in your business were to pass away. Buy/sell insurance is generally accompanied by a buy/sell agreement that requires any surviving partner(s) to purchase the remainder of the business in the event of the partner's death. The purchase is funded by the death benefit of the buy/sell insurance policy. The policy is generally paid for by the business.

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