What Is Keyman Insurance Used for?

What is Keyman Insurance? Keyman insurance is a specific type of insurance policy primarily for small businesses. These policies are designed to compensate the business when a key person dies or becomes disabled and can no longer fulfill their role.

What is the purpose of key man insurance?

Keyman insurance is defined as an insurance policy where the proposer as well as the premium payer is the employer, the life to be insured is that of the employee and the benefit, in case of a claim, goes to the employer.

Who can get key man insurance?

Basic Eligibility Requirements To Buy Key Man Insurance

The key person being insured needs to own less than 51% of the company's shares, and the total number of shares held by the key person and their family must be less than 70% of total shares.