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Keyman insurance: Is it expensive
Some people believe that all insurance policies are expensive, whether a Keyman or a car or home policy.

But the trick to determine if Keyman insurance is a worthwhile investment for your business is not so much to look at the premium costs, although they're important.

Instead, look into the future and do some simple what-if type scenarios and calculations. For example -
  • What if I or another important Director were to suddenly die, would the business easily survive and in turn would my shareholding be worth what it is today when it's left to my family or other beneficiaries?

  • What if my star salesmen suddenly dies, how would we replace those lost profits and possibly invaluable trade contacts

  • What if another key member of staff dies, do they play such a dominant role in the company's operations that it might in turn struggle to survive?

  • What would happen to our corporate debt and loans if a key member dies, would the banks get nervous and call them in, or perhaps they'll use personal guarantees that I and the other Directors have signed
Answer these and other similar what-if type scenarios and Keyman insurance might look like a sound and prudent investment. Remember, a successful and well run business is as much about planning for the future as it is in running the day-to-day operations.
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