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Key Employee Life Insurance from GMG Insurance

Insurance that covers the value provided by a key employee or partner is often called keyman or key person insurance. It is an important product for businesses that rely heavily on one or just a few leaders. Those can be executives or a specially trained technician or professional. Whatever they do for your firm, if they were to die prematurely, your business would suffer financially.

GMG Insurance has solutions that can protect you from such a loss.

Key Man Insurance Options

Key employee insurance will provide needed income to the business after the death of an insured person. That money could be used by partners to fund a buyout of the decedent’s share of the business from his heirs, or it could be used to bring in a replacement team member.

If an insured key man lives to retirement, it may be permissible to transfer ownership of the policy to the insured and have it continue as a personal life insurance policy.

One cost-effective option is for a group of executives to join together on a “first to die” policy that insures just the first of the group to die. Once the policy is used to cover the loss of that first to die, another policy can be bought to cover the remaining members. That way, key person coverage continues for the new members of the leadership team, but premiums reflect the fact that only one life is being covered.

Other Considerations

A key man life insurance policy not only provides liquidity and income protection for the business and its partners; it could also be required by creditors for their financial protection. A properly designed policy will reduce the chance that a key person’s death would result in bankruptcy, undesired sale, or business closure.

Make key person insurance part of your business continuity plan.

Turn to GMG Insurance for personalized attention on managing your assets and securing products that accommodate your lifestyle, now and as it changes over time. Contact us at (215) 497-9240; (800) 540-7900; or email at info@gmgins.com.