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Key Person Disability Insurance FAQs

By January 28, 2019 No Comments
LumberYard KeyPersonFAQs

Each company, regardless of size, employs persons who are essential to the continued success of the business. Key person disability insurance was created to protect the business in the event one of their key members suffers an illness, injury, or accident resulting in a disability. Investors, stakeholders, and business owners are able to continue operations and manage finances without major disruption.

 

How are Key Persons defined?

A key-person or employee is defined as someone who may hold either the most important relationships, accounts, or sensitive information, knowledge, or skills vital to the continued success of the business.

To whom is the payment dispersed?

If needed, coverage is paid to the employer or business.

How are these claim premiums taxed?

Generally, in the US the premiums are not tax-deductible.

Aside from finances, what is the benefit of Key Person Disability Insurance?

Planning for any unforeseen events allows the business to have a contingency plan in place for recruiting, hiring, and replacing the key person.

What types of companies should consider adding Key Person Disability Insurance?

Any business that employs someone whose contributions cannot easily be replaced should consider Key Person Disability Insurance.

Clients have come to rely on the Harbor America team for expert advice pertaining to the continued success of their businesses and protecting the future of their employees. Contact Harbor America to learn more.

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