Identifying a Key Person for Business Protection
Posted on March 5th, 2011 in All Posts, Business Protection, Key Person Cover. A keyman or keyperson is someone whose death or disability would have a serious affect on a company’s future profits. A business can have one or more employees who make a vital contribution to it’s profitability. The size or that persons shareholding or even if they are not shareholders at all will not necessarily indicate who is a keyman or keyperson for insurance reasons.Some common examples of who are keymen are shown below:
It could be a key sales person who contributes to a significant amount of profit.
They could be heavily involved in the development of a new product, because of their expertise and commitment without the the product launch might not go ahead at all.
They keyman may have valuable sales contacts that could be lost if they died. The key person may be the founder and owner and they may still be the driving force behind the business. Many other types of key people can exist within a business. The overriding factor is would the companies profits be affected if they lost that person.
Once that has been established the next phase is to work out the amount of cover required.
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