Different Types of Keyman Life Insurance

Keyman Insurance is designed to help businesses continue running as smoothly as possible when a key person is lost.

There is a variety of reasons for a business to want Keyman Insurance. See the table below for details of the different categories which are covered by Keyman Insurance;

Keyman Insurance Category	What cover is provided...
Loss or absence of a key person	Loss or absence of a key person A lump sum is paid which can be used to provide relevant training in an attempt to fill the needs of the company. The payout may also be used to provide stability to the cash flow at this transitional time.
Protection of Profits	The lump sum which is payable on the loss of a named key person can be used to top any profits which may have been lost.
Shareholder Protection	Shareholder Protection The lump sum may be used to buy the shares from the family of the deceased key person. This is done to control who has shares in the business.
Guaranteeing Loans	When a business takes out a loan it is quite common for the bank to request a person to stand as a guarantor to ensure that the repayments will be made. If this is the case they may also insist the company purchases Keyman Insurance for the guarantor. If the guarantor was involved in a serious incident or even death, the loan would still be repaid.

Keyman Insurance can provide cover for more than one person in the company at any one time, but they do need to be named on the insurance policy.

Keyman Insurance is available for the key members of staff within your business, this is not restricted to Directors.

Some valuable tips to consider when deciding who to list on the Keyman Insurance are:

Who are your main sales people?
Who are the people that drive the business?
Which employees or directors have essential skills or knowledge which would be detrimental to the business if lost?
Are there any directors who are acting as guarantors on any loans taken out by the business?

Any staff or directors who fill any of the above, would benefit the company by being included on a Keyman Insurance policy.

Guide Contents

Keyman Life Insurance
Different types of Keyman Life Insurance
Finding competitive Keyman Life Insurance
Frequently asked questions about Keyman Life Insurance
Where to get more help and advice about Keyman Life Insurance

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