di done right key person disability insurance

What it is

Key person disability insurance is coverage for the business. If a vital employee becomes disabled and is covered by a key person disability insurance policy, the business will receive disability income checks. The disability checks can then be used to cover the financial loss of the missing employee or it can pay for a temporary worker while the insured person recovers from the disability.

  • This insurance can be purchased for one or more people in a business.
  • The policy will pay according to its terms until the disabled person can return to work or is permanently replaced.
  • Key person insurance is a short-term coverage and most policies offer a benefit period of 12 to 24 months.
How to explain it

Stop and think. Do you employ anyone with capabilities that would be very difficult or nearly impossible to replace? How much business and profit would you lose if that person left? If you employ a veteran salesperson with established relationships; a highly-skilled individual with training that is unique to your business; or a business leader with a high level of responsibility and irreplaceable knowledge, take a closer look at key person DI. Someday, it might unlock the solution to keeping your business afloat.

Have you heard the old adage, “Don’t place too many eggs in one basket?” That’s what key person DI is all about. It keeps the eggs coming, even when you lose your best producing hen! Can you see how this coverage could help you survive a very stressful situation?

When to offer it

Offer key person insurance whenever a business has one or more key people that have capabilities or impact that would be difficult or impossible to replace.

This coverage can be offered in addition to a business owner’s individual disability insurance policy and the company’s business overhead expense disability insurance.