Key Person Insurance

Has your business insured its most valuable asset – its key staff?

WHAT IS KEY PERSON INSURANCE FOR?

Key Person Insurance is a name for the use of Insurance Policies which are structured in a particular way to protect a business. For Key Person Insurance the business is listed as the beneficiary and/or policy owner. A Key Person Insurance policy can cover the Key Person for a combination of any of the following:

· Life Insurance

· Total & Permanent Disability Insurance

· Trauma Insurance

· Income Protection Insurance

Consider what would happen to a company or business in the following situations:

· A key income producing Director dies or becomes disabled

· A business loan guarantor dies

· A key business employee with significant intellectual capacity, suffers a traumatic event.

“Key Person Insurance can be used for a specific Revenue purpose, such as funding the costs of search and hiring a key executive for a period of time, replacing lost income for a period of time. It can also be used for a specific Capital Purpose, such as eliminating debt for which the insured is responsible. ”

COMMON USES FOR KEY PERSON INSURANCE

· Requirements met for bank business loan

· Provide funds for recruitment and training a suitably qualified replacement

· Meeting business expenses while the company undertakes this transition

· Payment of any capital loans or personal guarantees in the event of a death

TYPES OF KEY PERSON INSURANCE COVER

· Capital protection

· Loss of revenue/profits

BEFORE TAKING OUT THIS TYPE OF COVER YOU SHOULD

· Understand the need for Key Person Insurance

· Know how much insurance is required

· Understand the different types of cover

· Structure the ownership of the policy

· Understand the tax and legal implications

There are a number of factors to take into account when evaluating and calculating the amount of cover you need for your Key People. We have a proprietary system that we use to help you understand and calculate the value of the key person your business would need on their death, disability or other trigger event, and we help you to assess the needs and insurability, and alternative funding methods available to you.

Contact us today to have a no obligation discussion about the QAI Business Vitality Programme.

General Advice Warning

QA Insurance Pty Ltd as trustee for the QA Insurance Trust (ABN: 59 644 299 394; Corporate Authorised Representative Number:1293763) is an Authorised Representative of QA Insurance Pty Ltd (AFSL 542245). This document has been prepared by QA Insurance Pty Ltd.

QA Insurance advisers are Authorised Representatives of Core Financial Services. Information in this document is based on regulatory requirements and laws, which may be subject to change. While care has been taken in the preparation of this document, no liability is accepted by Core Financial Services, its related entities, agents and employees for any loss arising from reliance on this document. This document contains general advice. It does not take account of your individual objectives, financial situation or needs. You should consider talking to a financial adviser before making a financial decision. Taxation considerations are general and based on present taxation laws, rulings and their interpretation and may be subject to change. You should seek independent, professional tax advice before making any decision based on this information. Should you wish to ‘opt out’ of receiving direct marketing material from your adviser, please notify your adviser by email, phone or by writing to us.

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