A key man is often the owner of a business or a person who is crucial to that business. One who's absence from the business would cause real problems that may eventually lead to the closure of the company. Key man is of course a term that can easily be applied to a woman in business.
The business person's particular skill may lie in being the person with all the ideas or a star sales person on whom the profit of the company relies. They may also have specialist knowledge or a technical expertise that the company relies on to grow.
The policy is taken out by the business and pay the policy premiums. These policies are often taken up by people who run their business with no other emploees at all.
In the event of prolonged sick leave or death, the policy is cashed in and the company can use the funds to recruit a replacement.
It can also be used to pay debtors or investors, be called on to pay off emplyees or in order to close a business down using legal and expert advice.
Where applicable key man insurance also offers the company some options other than immediate bankruptcy .
The policy may offer something like this ;
Full settlement - any outstanding balance on your finance agreement is paid in full if a nominated employee dies ( Includes 3 months arrears.) Includes Personal Accident cover, providing lump sum payments of up to £100,000.
Keyman Plus adds Accident and Sickness protection. If a nominated employee is absent due to sickness for more than 30 consecutive days, you can claim benefit equal to your monthly repayment.
Best UK Life Insurance is a trading name of Grovelawn Limited, who are authorised and regulated by the Financial Services Authority. Registered Address: 98 Station Road, Sidcup, Kent, DA15 7BY
FSA Registration Number: 314204