In today's times, employees are one of the most valuable assets of the firm. Some employees with rare skills, knowledge and technical skills are critical to the success of the company.
The death of a Keyman could result in the company suffering numerous losses as listed below:
- Loss of customers or sales attracted by the Keyman's ability
- Loss of Keyman's special skills and abilities
- Additional Cost of finding and training a suitable replacement
- Delay or Cancellation of future expansion projects
- Recall of Loans guaranteed by the Keyman
- Reduction in Credit Rating of the Company
Hence, it is extremely important for the company to secure itself by insuring the life of their key employees in case of their untimely deaths with a Keyman Insurance Policy.
The objective of a Keyman Insurance Policy is to help a business to recover from financial losses and make funds available in case of the untimely demise of the Keyman.
The proceeds from the Keyman Insurance Policy may help the company to recruit and train the replacements of the Keyman and offer compensation to the family member of the deceased in case of his/her death.