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What is
a Key Man insurance policy?
There is no legal definition for what Key Man insurance is. In general,
A Key man insurance policy has the following features.
An employer takes out an insurance policy insuring against loss of profits
arising from the death, sickness or injury of a key employee.
The beneficiary is the employer. In the case of a life insurance policy,
it is a term insurance, covering the life of the employee within the
term of the policy, with no other benefits. The term does not extend
beyond the period of the employee's usefulness to the employer.
The purpose of taking out the insurance is to compensate the employer
for the loss of trading income that may result from the loss of the
service of the key employee in case of death, sickness or injury.
Click Here to
request an online Key Man insurance quotation
What is partnership shareholder protection?
This is a combination of a legal agreement between all
shareholders or business partners and a life insurance policy covering
each director or business partner. The agreement means that in the event
of the premature death (critical illness and /or permanent disability
can be included as an optional extra) of a shareholding director or
business partner the surviving shareholders/business partners agree
to buy the deceased’s share in the business. The agreement means
that the beneficiaries must sell if the surviving partners choose, and
the partners must buy if the beneficiaries choose. It is imperative
that an insurance policy taken out in conjunction with this agreement
in order to provide the necessary lump sum of money for the surviving
partners to purchase the deceased’s share of the company. The
insurance policy can be arranged in a currency decided by you.
Great British Finance Limited is authorised and regulated by the UK
Financial Services Authority (FSA). For further details please read
the Great British Finance keyfacts that explain what products and services
we are authorised to provide - to read our Keyfacts statement please
click here.
Questions? Contact Us Phone: 0845 130 0009 ©2003-2006 Great British Finance Limited, All Rights Reserved.
E&OE. Head Office located at 19 High Street, Swadlincote, Derbyshire,
DE11 8JE and 5 St Johns Lane, London, EC1M 4BH
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