Key Person

Every business operating today has key people that help it remain successful and profitable. Although most businesses insure their property and profits, few think to insure their most precious assets—the men and women whose experience, talent and judgment contribute substantially to the financial success of the business. Loss of a key person can adversely affect the business’ earning potential and will cause expenses related to finding his/her replacement.

• Typical losses associated with losing a key person include:
  • Loss of management experience and leadership;
  • Loss and disruption in production;
  • Loss of credit rating for business; and
  • Loss of capital that is now required to find a replacement.
• Closely held businesses are particularly at risk since there are typically one or two people whose skill and contacts make the business profitable.