Arizona Key Person Insurance
When you need a licensed adviser
Written by
Candace Jenkins is a licensed insurance advisor with over a decade of experience. She is also a writer and loves to write on all things insurance. Candace writes for TrustedChoice.com on a continuous basis and is here with the facts about all your insurance inquiries.
Reviewed by
Jeff Green has held a variety of sales and management roles at life insurance companies, Wall street firms, and distribution organizations over his 40-year career. He was previously Finra 7,24,66 registered and held life insurance licenses in multiple states. He is a graduate of Stony Brook University.
When you have employees or executives who help your business operate, the proper coverage is necessary. In Arizona, there are roughly 1,000,000 people employed by small business owners. Key person insurance will help insure their impact on your company.
An independent insurance agent has access to multiple carriers for more coverage and premium options. They work on your behalf at no cost to you. The best way to save is by connecting with a local expert.
What Is Key Person Insurance?
When your Arizona business loses an essential employee, there is a void. Key person insurance can fill that gap if you're proactive. Take a look at how coverage works.
- Key person insurance: This is a life insurance policy that can be bought for a key executive's life. Your business would pay for the policy's premiums and be listed as the beneficiary. This policy is also known as key man insurance or a business life insurance policy.
What Does Key Person Insurance Cover?
Like other business policies, your key person insurance offerings will vary. Each carrier will have its own brand of coverage. Some standard protections are typical across the board. Check out what a key person insurance policy can cover.
- Insurance to replace profits associated with a key person
- Offsetting lost income from sales due to a key person
- Protection for shareholders and other interests
- Cover losses resulting from a business project involving a key person
What Is the Purpose of Key Person Insurance?
When you are proactive in your business, you can avoid a lot of pitfalls. Coverage for your key people is one area you can control with the right commercial insurance. While it may not be a nice thing to think about, it's necessary to plan for the worst.
A good key person policy will help your business pay for any debt and even prepare for closure if applicable. A lot of times, it can save you from going bankrupt. Check out some things it can cover.
- It will pay debts
- Pay severance to employees
- Close the business down if necessary
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What Does Key Person Insurance Not Cover?
It's essential to know what a key person policy won't cover. Every carrier is different, and some of these will not apply to you. Your Arizona key person policy may exclude the following.
- Disability insurance for a key person
- Bodily injury for a key person
- Lost wages for a key person
- Long-term care of a key person
A standard key person policy will have the above exclusions. Some will include them as a coverage offering. This depends on your carrier and how comprehensive your insurance is.
Key Person Insurance Cost
Similar to your small business policies, your pricing is personalized. Key person insurance is no different. Take a look at some factors companies use to rate your policy.
- The key person's health history
- The key person's current health status
- The limits of protection you choose
- If the key person has any current life policies
- How long the key person has worked for your company
- What the key person's role is at your company
Carriers look at your personal data and outside exposures when setting your premiums. Your exact costs won't be determined until you obtain quotes. The health and industry of the individual being insured will have a significant impact on price.
How to Connect with an Arizona Independent Agent
When you're searching for business insurance in Arizona, there are some things you need to know. A trusted adviser can help you find coverage for the lowest price. If you're quoting key person insurance, you'll want a policy that's accurate and sufficient.
Fortunately, an independent insurance agent works on your behalf at zero cost to your business. They look for the best policy within your budget. Get connected with a licensed expert on TrustedChoice.com and start saving.