In every business, there are people you simply couldn’t do without. Whether it’s a founding director, lead developer, top salesperson, or operations manager, losing them to illness or death could mean lost revenue, delayed projects, or even business collapse.
Key Person Insurance provides a financial safety net. It pays out a lump sum to the business if a crucial employee or director dies or is diagnosed with a serious illness. This gives you the cash flow to cover lost income, replace the key individual, and reassure creditors, investors, or clients.
At Mortgage Knight, we help businesses of all sizes protect their most valuable asset — their people — with tailored Key Person cover that fits your team, your risks, and your goals.
A key person is anyone whose death or serious illness would have a significant financial impact on your business, such as:
Death or terminal illness: Pays a lump sum if the insured dies or becomes terminally ill during the policy term
Critical illness (optional): Pays out if the key person is diagnosed with a serious illness such as cancer, heart attack, or stroke
Business-owned policy: The business pays the premium and receives the payout
Tax treatment: Premiums and payouts may have corporation tax implications — we’ll guide you through that
Ans: Yes, the business pays the premiums, owns the policy, and receives the payout.
Ans: Absolutely. You can cover multiple key individuals with separate policies or combined protection, depending on your needs.
Ans: No, shareholder protection covers ownership transfer on death. Key Person Insurance covers business continuity if a key employee dies or is seriously ill.
Ans: We’ll help you calculate it based on lost profit, replacement cost, outstanding liabilities, and business exposure.
Ans: It depends. If premiums are a business expense, payouts may be taxable. If they’re not claimed as an expense, the payout could be tax-free. We’ll liaise with your accountant to get it right.
Ans: Yes, many Key Person policies include an optional critical illness rider, which pays out if the key person becomes seriously ill.
Ans: Usually yes, especially for higher sums assured. We’ll manage the application and help streamline the process.
Losing a key employee is hard enough, don’t let it become a financial crisis too. Key Person Insurance gives you time, options, and cash flow to survive the storm.
Speak to Mortgage Knight today and let us guide you through the right policy for your business. No jargon. Just expert advice, properly explained.
