Key Employee Insurance

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. The same insurers that sell individual coverage usually write key employee policies, so it helps to compare the best life insurance companies before applying.

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

Owners often buy key employee coverage alongside their general liability and property policies. Our guide to startup business insurance covers the other policies most small companies need.