Key Person Insurance

Trilogy Financial Services - Corporate Office in Huntington Beach

Key Person Insurance is insurance purchased and owned by a business on the life of a key employee. Key Person Insurance protects the business against financial losses resulting from the death of a valued worker, whether or not the employee is an owner of the business.

Concept Profile

Possible Client Objectives:

  • Compensate for lost profits while replacement worker is being sought.
  • Provide funds to hire and train replacement worker.
  • Keep lines of credit open after key person’s death.
  • Loan indemnification for creditors in relation to business financing.

Relevant Factors:

  • Uniqueness of the key person.
  • Ease of which key person may be replaced.
  • Role of key person in relation to the continued success of the business endeavor.
  • Valuing the key person.
    • Estimate the present value of the key person’s future contributions to the business.
    • Use a multiple of the key person’s current salary

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