Complete Financial Questionnaire

Protect The Future Of Your Business With Keyperson Insurance

medium_4612663237

As you know, the future success of your business is dependent on a few key people
i.e you and the other keypersons in your company.

Simply put a keyperson is any “key” employee, whose death or serious illness could cause your business to suffer a financial loss.

Did you know that 3 out of 4 businesses close within 5 years of the death of the founder?

Why insure your key people?

There is a very real possibility that your business will suffer the loss of a keyperson. 1 in 5 claimants are under 39. 

The loss of a keyperson can have a major financial and operational impact on your business. Some of the ways in which your business may be affected are listed below.

  • The business will have to survive without that person’s unique skills, business contacts or intimate knowledge of your business. This may result in a loss of confidence by both customers and suppliers.
  • Bank loans could be called in if the keyperson had given a personal guarantee
  • There could be a withdrawal or reduction of credit facilities by banks or suppliers who are concerned about the future of your company due to the death or serious illness of that person.
  • Loans made will have to be repaid.
  • Not forgetting the additional cost of recruiting a suitable replacement.

What can you do?

Putting Keyperson Insurance in place can help your business overcome the financial repercussions of losing a valued member of staff.

The policy will pay out a lump sum benefit to the business on the death or serious illness of an insured keyperson. This lump sum benefit will compensate the business for any loss of profit or can be used to repay loans or recruit a suitable replacement.

What is Keyperson Insurance?

Keyperson insurance is life assurance taken out and paid for by the business on the life of one of its employees. On the death or serious illness of that keyperson, the business will receive the lump sum.

How to set up Keyperson Insurance?

Having determined who your key people are, the next question is how much you should cover them for? A general rule of thumb is to cover the keyperson for 5 to 10 times their current annual salary. However you should also take into account the following:

  • Any loans personally guaranteed by the keyperson and/or any loans the keyperson has made to the business.
  • Estimated loss of profits that the business would suffer due to the death or serious illness of the keyperson, including the cost of recruiting a suitable replacement

Conclusion – What is Keyperson Insurance?

If you’re concerned that the death or serious illness of a member of your company could have severe repercussions for your company, please get in touch using the form below or call me directly on 05793 20836 and we can discuss putting a plan in place.

Free 5 Email Crash Course

Who wants a simple guide to life insurance?
  • This field is for validation purposes and should be left unchanged.

photo credit: ‘Ajnagraphy’ via CC

financial_questionnaire

Life Insurance
Give us a quick outline of how we can help and we'll be right back to you.

Don’t know where to start?

Have a nose through our free life insurance guides

View our guides

Life Insurance Quotes - Free and Easy!

As Ireland's leading independent insurance broker, we specialise in comparing the rates and policies from the top five Irish life insurance providers and offering the very best value quotes to suit the individual needs of our clients. Our expertise lies in finding a suitable insurance plan for those with specific needs, be it a particular illness, occupation or claim history, we've got you covered in every sense!

Watch our video