Key Employee Insurance
Updated: 12 November 2024
What Does Key Employee Insurance Mean?
Key employee insurance refers to a life insurance policy that a corporation or business purchases on the life of a key employee. The business or corporation owns the policy and receives the death benefits if the employee passes away. This type of insurance is typically applied to employees whose death would have a significant impact on the business’s operations. A key employee is someone whose skills, expertise, and contributions are essential to the success and functioning of the organization.
Insuranceopedia Explains Key Employee Insurance
Key employee insurance offers several advantages for an organization, including:
- Protection against income loss due to the death of a key employee
- Peace of mind for the organization, reassuring it about the company’s future if the employee passes away
- Safeguarding investors’ financial interests
