What Is The Purpose of Key Person Insurance?

What Is The Purpose of Key Person Insurance

As every employer knows, your valued employees are a large part of your business. Not only do they perform pivotal roles within your company, but they also keep everyone else motivated and on the ball. But what would happen if you had to lose any of your main profit generators? Would you be covered against financial disaster? Key person insurance is the comprehensive policy from CIG that caters for this.

What Is The Purpose of Key Person Insurance

From the owners of a business to directors, project managers, CEO’s and sales heads, key person insurance covers the loss of those whose absence may threaten the future of the company.



Here’s the low down on this policy from Compendium:

  • This kind of insurance covers the loss of any employees that may affect the running and profitability of a company.
  • This policy can be developed and shaped to suit your company’s needs by one of our expert brokers.
  • It entails that a lump-sum be paid out to your business should an identified “key person” pass away or become incapacitated, rendering them unable to fulfil their duties to the business for an extended period of time.
  • This policy covers you for costs that you may incur should you need to replace the employee through headhunting or up-skill a current employee to fill that role. It also covers the worst-case scenario of having to wind up the business should the company be unable to run without the person who is gone or incapacitated.
  • You will need to specify key employees or persons within the business that you would like to have covered. These are the employees who perform major operations that the business would not be able to function without. This may involve some sort of consultation with the board of your company before initiating such a policy. Alternatively, if you run a small business that does not have a board, as the owner you should discuss it with co-owners.

At Compendium Insurance Brokers, we want to help you run your business for years to come. For more on this policy or other business insurance products that we offer, please visit our website today! www.cig.co.za

Get a Quote

Fill in your details and we’ll give you a call.