Key Person Assurance
A key person’s death or disability can have a significant impact on your business, including its profitability, sustainability and capital value. To protect your business from these risks, the business can take out a policy on a key person’s life to cover extra costs and losses.
The plan guarantees that cash will be available to absorb any disruptions to the business, protect existing credit facilities and provide the necessary funds for the recruitment and training of a replacement. This means your business can have greater financial security and certainty irrespective of what happens to someone who plays a key role in your business.
It is important to note that a keyperson is an individual that has an important impact on the future income and profits of the business. It’s not just any employee, but someone who’s absence, whether through death or disability, will severely impact the future sustainability of the business.
There are various tax, estate duty, valuation and succession planning risks and implications if the key person assurance plan is not structurally sound and well designed. At Infinite, we take a complete view of the situation and design the holistic plan ensuring it meets the key requirements of a sound plan.