SPECIALIST ADVICE
Key person insurance
Key person insurance is owned by the business and can provide funds if a specified employee, founder or revenue generator dies or suffers a covered critical illness.
Protect the business from losing a vital person
Key person insurance is owned by the business and can provide funds if a specified employee, founder or revenue generator dies or suffers a covered critical illness.
Identify the risk
Assess the financial impact of losing a person central to revenue, relationships or operations.
Set the cover
Use profit contribution, replacement cost, borrowing or other evidence to support the amount.
Business ownership
The company normally owns the policy, pays premiums and receives any valid benefit.
Continuity plan
Decide how funds could support recruitment, debt, cash flow or transition.
Key person insurance FAQs
Who owns a key person policy?
The business normally applies for, owns and pays for the policy, with the key person insured.
How much cover can a business obtain?
Insurers assess the financial loss, evidence and purpose of cover rather than using one universal formula.
Are premiums tax deductible?
Tax treatment depends on the arrangement and purpose. The company’s accountant or tax adviser should confirm the position.
YOUR SMART MORTGAGES CONTACT
Discuss your plans with the right adviser.
Aaron can coordinate business-protection enquiries with the appropriate protection specialist.