Of course, the coverage a business needs depends on the type of company you run and the number of employees who work there. There are also some optional insurance coverage business owners should always consider.
Here is the third of three “optional” insurance coverages that business owners often leave out of their insurance package which could literally save the business in a time of crisis.
Key Person Insurance
No one wants to consider the disability or death of a colleague. But if such a tragedy could lead to your company’s demise, then it’s worthwhile to consider key person insurance.
Typically, key person insurance covers the owner, the founders or one or two key employees. It is life or disability insurance purchased by the business and is payable to the business. It is beneficial when a company’s survival relies heavily on the role of one or two people. When the “key person” dies or becomes disabled, insurance can help make up for lost sales or earnings or cover the cost of finding or training a replacement.
Sometimes one of the business owners can be replaced easily, but there may be an individual who has a specialized skill or who contributes largely to the company’s growth. For example, there may be someone who specializes in a skill that only few people in the country have. Now an organization has to make a huge offer to get someone to move from half way across the country to work for them.
Whether you are an executive or not, take a look around and see what would happen to the business if a certain employee would pass away, or become unable to work.
Often times these optional coverages are assumed to be in the business owners policy but in fact they are not. Review your business insurance policy to make sure everything important in your business is protected (not just the building and liability).
Contact us for a free policy review and we’ll ensure your business is properly protected.
EMERGE INSURANCE AGENCY