Protect Yourself. Cover The Key Man.
Business Insurance is one of the key expenses of an enterprise. It is prudent for the company to protect themselves from any kind of loss...
It is prudent for the company to protect themselves from any kind of loss that they […]
Insuring a key person on whom the company depends on for the smooth running of the business is extremely […]
“Nothing is certain other than death and taxes”. This is the fact that has been defined clearly by Benjamin Franklin. This statement explains and emphasizes the importance of insurance. Life is unpredictable. Insurance policies are the cushion that one depends on when the foreseeable calamity cannot be avoided. The trick is however in making a list of things that would need insurance. The rest is just a matter of paperwork and payment. Know more atkey person insurance tax treatment.
Business Insurance is one of the key expenses of an enterprise. It is prudent for the company to protect themselves from any kind of loss that they could incur in the process of running the business. The normal course of business includes various activities that could go wrong. Insurance is needed to protect them from such losses. Anything from the damage of property to legal liabilities and risks related to employees can be covered.
Availing insurance is very crucial to the business. This insurance is what is needed to protect the entity from a financial loss or responsibility that occurs due to an unavoidable circumstance. While most of the calamities can be anticipated, some are beyond control. It is advisable to take insurance to protect oneself against any and all possible accidents.
If the company is uninsured and is unable to raise the money needed to pay for the loss incurred, it could mean the end of business. This could be a building catching fire or a key man being rendered incapable. Statistics say that close to 46% of companies and businesses fold when one of the key people die or suffer seriousness illness.
It is therefore considered to be part and parcel of the running expenses to insure.
Protecting the person that helps you run your business is a vital part of insurance. Just as objects and infrastructure are covered, key persons are protected too. They are insured to compensate the company for the loss of that person. This could be due to critical illness or death. Any business, irrespective of its size is bound to suffer when the key person is suddenly unavailable. The loss of this person creates a financial strain to the business. The compensation that is received from insuring the key person is used to cover the interim expenses. It provides the much-needed option that the company is desperate for. The funds can be used for purposes such as restructuring, paying severance to the employees, etc. These funds are utilized to keep the business going till a perfect replacement is availed.
Insuring a key person on whom the company depends on for the smooth running of the business is extremely crucial to keeping the business alive. It has many benefits
End of the day, it makes sense when the business does not put all their eggs in one basket. While it is unavoidable to have one key person who literally runs the entire ship, protecting the business against loss of this key man is considered necessary in every way.
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