Home PageAbout Us

What exactly is Key Man / Key Person Insurance?

De/inition -

Key Man / Key Person Insurance is Life insurance and long-term disability income
insurance on major employees, with benefits payable to the business. Key person
insurance has these advantages:

(1) Enhances the ability of the business to continue operations;

(2) Fosters smooth sale of a going business between an estate and a purchaser by
providing funds to buyout the interest of a deceased key person;

(3) Encourages key employees to stay on the job;

(4) Attracts new key employees;

(5) Provides funds for expenses of hiring and training of a replacement key employee;

(6) Provides a line of credit (A permanent life insurance policy has cash values that are
available for loans at advantageous rates.);

(7) Policy proceeds, which are income free, are payable even if the key person is no
longer in the employ of the business at the time of death; however, the business must
continue to make the premium payments after the key person leaves the employment;

(8) A life insurance policy can be surrendered for its cash value or sold to the insured key
person; thus, the business will usually at least receive the return of premiums;

(9) Long-term disability income insurance on a key person also provides funds for salary
continuation to the disabled key person. (For temporary disability, the business might
prefer to self-insure because the expense of premiums for this coverage is generally
excessive when compared with the potential income benefits.)

Source: Answers.com

We Make Getting Insurance Easier

Starting the process is as easy as picking up the phone and calling our office or clicking
on the button below and completing the online form. No sales pressure, no confusing
insurance language, no worrying about which company to select. We are an independent
insurance agency and have access to dozens of insurance companies. Let us help guide
you and make the process easier for you. 


6965 South 69th East Ave Tulsa, OK 74133
P.O. Box 700420 Tulsa, Oklahoma 74170-0420