In a small business, there are often certain employees who have a particularly critical impact on the bottom line. Key person insurance is life or disability income insurance purchased by the business on the life of such an employee and payable to the business. The death benefit can help make up for lost sales or earnings or cover the cost of finding and training a replacement.
An insurance professional can help you determine which employees, if any, are "key" to the business as well as evaluate how much and what kind of insurance should be purchased.
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