We are a small firm considering Keyman Insurance as there are four or so key members of the team we would really struggle without. How would we go about placing a monetary value on these individuals?
This is a very good question and one that needs a lot of consideration.
Key Person Insurance is designed to provide the business with a lump sum payment should the insured life pass away. You also have the option to add Critical Illness Cover, which would pay out if a key individual fell ill with one of the critical illnesses listed on the policy.
The aim of the cash benefit is to keep the business on the straight and narrow during these difficult times.
The value you place on losing a key person should reflect the loss in profits to the business. For instance the key person cover might equal the amount of profit typically generated by a sales director.
Additional costs that may well occur can also be included, such as the costs associated with finding, hiring and training another individual to the same standard.
For any organisation considering business protection it is important to ensure any provisions made are adequate.
We have a range of calculators which we can work though with you to help you choose a suitable level of cover for your key members of staff and our advice is totally fee-free, so get in touch today on 02084327333.
Drew was incredibly helpful all the way along and very responsive and patient with any questions I had (which were many). He was able to get me a much better deal on my new health insurance than I had been able to get online. A success all round!