The main purpose of Keyperson Insurance is to provide business continuity should a member of staff, who makes an important contribution to the financial performance of the business, fall seriously ill or die. This may mean a cash provision to be used to recruit a replacement or to maintain positive cash flow in the short to mid-term.
It’s important to be realistic about the financial impact of losing a key member of staff. Often it isn’t just the loss of income or profits the employee generates but the cost of an interim replacement, recruitment of a permanent replacement as well as intangible factors such as staff morale and the cost to production of losing a key person within any business.
Keyperson Insurance can be contracted as a standalone Keyperson Life Insurance policy or to include Critical Illness cover to provide protection in the event of serious illness thereby offering a broader and more comprehensive level of protection for your business.
Keyperson Insurance is also available in the form of an Income Protection policy. In this scenario, the business receives a regular monthly income if the key member of staff is unable to work due to accident or illness. The proceeds can be used as a short-term solution to fund interim staff until a replacement is found or the key member of staff returns to work.