Do I Need a Key Man Policy?
If you aren't sure whether you need a key man policy or not, consider your business structure carefully. Do you have a plan of succession, should you or another vital member of your team die?
Are there key employees who are vital to the survival of your business? A product developer, top sales performer, or master of your unique technology demands, for instance? How long did it take to find this person, and how quickly/easily could you replace them?
Depending on your preparedness and the role of your key employees, you could suffer months of setbacks and profits loss while picking up the pieces. That's where key man life insurance comes in.
In other cases, you may be required to purchase key man coverage. Sometimes investors require this type of coverage to be in place before investing in order to protect themselves and their investment dollars. These insurance options are an alternative to, in some cases, immediate bankruptcy for the handicapped business.