Loss from Disability
This type of key man insurance addresses the event of disability where the individual in the policy cannot contribute to the operations of the company. The policy gives cash for attracting, training and replacing the employee either temporarily or permanently.
Loss of Profit
If the key employee who dies causes a loss of profit because they can no longer contribute to sales or project management or provide their unique skills or knowledge, or anything that generates profit, the policy would pay out proceeds to offset the loss.
Loss of Credit
To ensure that loans do not go unpaid causing credit to dry up, key man insurance benefits provide for the ability to pay off loans to banks or private institutions.
Benefits of Key Man Life Insurance
When a keyman of the company dies, the business could be thrown into turmoil due to loss of revenue, loss of client relationships, loss of leadership or loss of company morale. Key man life insurance acts as financial brace against these potential difficulties.
Key man insurance generally costs less than a traditional life insurance policy for Colorado business owners. Generally speaking, if a company in Colorado loses its key man, the insurance policy proceeds work to stabilize finances and secure a smooth transition during the period of time of potential instability.
Denver based businesses mitigate these potential problems before they happen with a key man life insurance policy.
Denver business owners should ask other owners who already have a key person insurance policy to see what exact coverage they chose. The amount of coverage and your business structure should also be considered as that will affect rates. Once you choose to purchase a key man life insurance policy after understanding its benefits, it is best to get multiple quotes from an insurance broker so you can get the best rate.
