Life insurance provides people a way to prepare for the inevitable, even when it comes too soon.

What many may not consider is how a person’s passing can negatively affect not only their family but also their business.

Key person business life insurance protects businesses in these cases in the same way that personal life insurance protects families.

This policy offered by business life insurance agencies is one that every company owner should consider.

What Is Key Person Business Life Insurance?

Key person life insurance is a type of business life insurance policy that protects company owners and partners when a key person such as a partner or owner passes unexpectedly.

It is a policy that is offered by business life insurance agencies as part of an overall business insurance portfolio to ensure that every company is well-protected against losses that can negatively affect them.

Like other life insurance policies, it is available as a Term policy to cover specific periods or a Permanent policy, depending on the company’s need.

These policies provide essential financial benefits that can help surviving partners deal with the loss of their partner or key person so the company can keep running without them.

Who Should Purchase Key Person Life Insurance?

Business insurance agents recommend that any company that relies on the skills, knowledge, and expertise of specific individuals within the company purchase key person life insurance to protect their business.

Whether that person is an owner, a partner, a top executive, or someone else, if their absence would significantly affect the continuation of the company, this policy can provide needed financial support.

Key person business life insurance is especially recommended for startups, small companies that depend on a few key individuals, companies that have undergone recent changes in management, those with high turnover rates or with high injury rates, and others.

Why Is Key Person Business Life Insurance So Critical?

When an owner, partner, or other key individual for a company suddenly dies or becomes disabled, the ownership of that business typically is handed to either a surviving business partner or the spouse of the deceased.

For many companies, this can create circumstances that interrupt the business or leave family members with the responsibility of figuring out what to do with the company.

A key person policy from a business life insurance agency can provide essential direction for those situations, while also providing the funds necessary for a share buy-out or other expenses incurred during this difficult time.

Learn About Key Person Insurance In This Video

In this short video, Service Insurance Group partner Brad Hurt discusses key person life insurance, and why every small business should consider purchasing this policy:

Discuss Key Person Insurance With A Knowledgeable Insurance Agent

Small businesses require the input and energy of each key person to keep them functioning and profitable.

Noting this, every company should invest in a key person business life insurance policy as part of their critical business planning.

With this useful coverage from a business insurance agency, small business owners and partners can rest assured that in the event that the unexpected does happen, they have already worked out solutions for their company to keep going.

An experienced business insurance agent can help.