Key Person Cover
Cash to the business when the loss of one individual materially affects revenue.
What It Is
Understanding Business Protection
When a business is built around a small number of people, the loss of one of them isn't only a personal tragedy. It's a revenue event, a lending event, and often an ownership dispute waiting to happen. Business protection uses life and disability coverage to fund the plan you'd otherwise have to improvise.
Key Person Coverage
The business owns a policy on an individual whose knowledge, relationships or production drive results. If that person dies, the business receives the benefit, giving it cash to cover lost revenue, recruit a replacement, and reassure lenders and clients while it recovers.
Buy-Sell Funding
A buy-sell agreement says what happens to an owner's share if they die or leave. Insurance is what makes that agreement executable, providing the surviving owners with the cash to buy the departing owner's interest at a pre-agreed value, instead of ending up in business with an heir who never wanted to be there.
Loan & Guarantee Protection
Many business loans require a personal guarantee, and some lenders require assignment of a life policy as a condition. Coverage sized to the debt keeps a business loan from becoming a family liability.
Key Features
What This Coverage Can Do
Features vary by carrier, product and state. We'll confirm exactly what's available for your situation before anything is recommended.
Buy-Sell Funding
Funds the purchase of a departing owner's share at an agreed valuation.
Loan Protection
Coverage aligned to business debt and personal guarantees.
Executive Benefits
Supplemental coverage used to attract and retain the people you can't afford to lose.
Deferred Compensation
Informally funded arrangements that reward long-term commitment.
Business Continuation
A written, funded plan for what happens on the worst day.
Who It's For
Is This a Fit for You?
If one or more of these sounds like your situation, it's worth a conversation. If none of them do, we'll tell you that too.
Partnerships with two or more ownersThe most common place a missing buy-sell agreement causes lasting damage.
Businesses with concentrated revenueOne producer or one relationship drives a large share of income.
Companies carrying debtEspecially where a personal guarantee sits behind the loan.
Family businessesSuccession is emotionally complex; funding removes one major point of conflict.
Firms competing for talentExecutive benefits can differentiate you from larger employers.
Owners planning an exitA funded agreement makes the eventual transition far cleaner.
How It Works
Our Four-Step Process
01
Discovery Call
A conversation about your family, your obligations and what you're actually worried about. No pitch.
02
Needs Analysis
We put real numbers to it: debts, income, existing coverage, and size the gap.
03
Market Comparison
We shop 40+ carriers against your specific profile and show you what came back.
04
Placement & Review
We handle the application and underwriting, then review the policy with you annually.
Questions
Frequently Asked
Who should own the policy: the business or the individual?
It depends on the purpose and the structure of the agreement. Key person coverage is usually owned by and payable to the business. Buy-sell arrangements can be structured as entity purchase or cross-purchase, and the ownership follows the design. This is an area where your attorney and CPA should be involved alongside us.
Are premiums tax deductible?
Generally, premiums for business-owned life insurance are not deductible, and the death benefit is generally received income-tax-free, though there are important exceptions and notice requirements for employer-owned policies. Please confirm treatment with your CPA. We don't provide tax advice.
How do we value a key person?
Common approaches include a multiple of compensation, the estimated cost to recruit and train a replacement, or the profit attributable to that individual. We'll walk through the options and let you set the number you can defend.
We already have a buy-sell agreement. Is that enough?
An unfunded agreement is a promise without money behind it. Many agreements we review are also years out of date, with valuations that no longer reflect the business. Both the document and the funding should be reviewed periodically.
Can we cover a partner who has health issues?
Often yes, though pricing and carrier appetite vary considerably. Because we're independent, we can approach multiple carriers rather than accepting one company's view of the risk.
What about disability, not just death?
Good question, and it's frequently overlooked. A disabling injury or illness is statistically more likely during working years than death. Disability buy-out and business overhead expense coverage address that gap and are worth discussing together.
Important
This page is general information, not a recommendation or an offer of coverage. Product availability, features, riders,
pricing and underwriting rules differ by carrier and by state, and all coverage is subject to the terms of the issued policy.
Nothing here is tax or legal advice.
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