Key Man Insurance
Key Employee Loss
Does the success of your company’s continued profitability depends on one or more “key” employees? One that may have a special talent that could not be replaced if they were not on the job. Would you like to insure that if this key employee were taken from you from an untimely death, you would have the financial assets available to help you through until such time as you could replace their special talents?
Solution:
The company could purchase a life insurance policy in the amount of money needed to fund company operations if the key employee died until such time as a suitable replacement is found. More importantly, these funds may provide a cushion for the company to retool if the loss of a special employee prevents the continuation of the business at all.
Key Employee Retention
Does the success of your company’s continued profitability depends on one or more “key” employees? One that may have a special talent not easily or even able to be replaced. Would you like to insure they do not leave your employ and maybe even go to some other company, possibly your competition?
Solution:
An executive bonus plan could be put in place for their retirement. You, as the employer could set up a special life insurance program on behalf of your key employee. The program would provide life insurance that insures them while they are working and at their retirement provides a tax free income. A vesting schedule could be established whereby if the employee left the company, they would forfeit all accumulated benefits in the plan. This is sometimes referred to as a “golden handcuff”. Properly structured, contributions to the plan are tax deductible to the employer. More importantly, it may provide a benefit that is the difference between losing and keeping a valuable employee.
Contact us for a complementary, no obligation analysis of your personal situation and a proposal on how best to implement this program should it be appropriate for your business planning needs.