Members of a foresters society may be business owners who heavily rely on one or more people who keep the business running. When people are your greatest business asset, the death of certain individuals could put the future of the business in jeopardy. It may be prudent to consider purchasing key person life insurance to help manage this important business risk.
Key person life insurance can cover financial strain due to lost profits, the costs of hiring and training a replacement, or meet expenses for the decedent’s family members who were relying on the salary or other types of compensation to meet financial obligations. It may also be used to cover costs associated with maintaining business continuity and ensuring employees, customers and vendors that the business will be able to meet its obligations and commitments.
Covered individuals may be considered irreplaceable in the short term, may have a special level of knowledge and expertise that is unique within the organization, or may be vital to maintaining customer relationships. Covered people are often company owners or senior executives.
While there may be several methods for managing the risk of losing key employees unexpectedly, companies can choose key person life insurance as part of their overall risk management plan. Foresters society members may use this type of insurance to protect their companies and families should an unexpected death occur.