Purpose: Protects the business from financial ruin due to the loss of a vital employee, covering expenses like lost revenue, debt repayment, and hiring replacements.

Types of Coverage:

• Life Insurance: Provides a lump sum upon the death
• Critical Illness: Provides a lump sum if the key person is diagnosed with a severe illness.
• Disability Insurance: Replaces income and covers expenses if the key person is disabled.
• Key Person: Someone whose knowledge, skills, or reputation are critical to the business (e.g., owner, founder, top sales manager).