Frequently asked questions

What is Key Person Insurance?

Key person insurance, also known as key-man insurance or key executive insurance, is a type of life insurance policy designed to protect a business from the financial impact of losing a critical employee or owner. This individual is often referred to as the “key person” because their skills, expertise, and contributions are essential to the business’s success.

Can I use life insurance to protect my key employees or partners in case of their death or disability?

Yes, key person insurance can provide funding for replacement costs, lost revenue, and other expenses associated with the loss of critical team members.

How can life insurance secure my share of the business I own if I pass away unexpectedly?

Using life insurance can help ensure a smooth transfer of ownership and provide liquidity for heirs, allowing your business to continue operating without disruption.

Can life insurance help us pay off debts and taxes associated with the transfer of ownership?

Yes, life insurance can help pay off debts, taxes, and other obligations, ensuring your partners inherit the assets you want them to have.

How can I contact you?

You can reach us by completing the online form. We are always happy to answer your questions.

What is IRC § 162?

IRC § 162 is a section of the United States Internal Revenue Code that allows employers to deduct as ordinary business expenses certain payments made to executives under a nonqualified deferred compensation plan.

Can we use life insurance to fund a buy-sell agreement or purchase a partner’s interest in case of an unexpected event?

Yes, life insurance can be used to fund buy-sell agreements and provide liquidity for partners or heirs in case of unexpected events.

What types of life insurance policies are available for corporate executives, and which one is right for me?

Common options include term life, whole life, universal life, and variable universal life insurance. The best choice depends on individual circumstances, goals, and the business strategy.

What is a supplemental executive retirement plan (SERP), and how does it work?

A SERP is a tax-deferred retirement savings plan for executives that can provide additional income in retirement, supplementing other pension plans or investments.