How to protect your business if a KEY employee dies

Do you have a plan in place if you lose a KEY player on your team?

If someone is important to your business (not the rank and file, but someone who is seemingly irreplaceable) dies or leaves the company, are you prepared?

1. Offset revenue losses

2. Funds may be needed to ensure business continuity

You need to make sure to have the funds in place while you bridge the gap training a new person.

3. Funds to recruit and train qualified talent

Your solution: Key Person Life Insurance

This ensures that you have the money available when you need it most.

How it works:

  • Company buys life insurance on key personnel (if they aren’t around, the business would suffer)
  • If a key person on the policy dies, the company collects from the life insurance that was purchased.


  • Insurability
  • Make sure to revisit your strategy to ensure it isn’t out of date
  • Understand how to value a key person
  • Premiums are NOT tax-deductible

3 Basic Ways to Value Key People

1: Multiples of total compensation

2: Cost of replacement

3: Contribution to the company profits

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