Key man life insurance is an interesting form of protection. Back when individuals would spend their entire lives with one company, this type of life insurance would have been an essential component for a few members of the company. Which only makes sense: if you grow with your company and have been there since the beginning, your role in the company’s development is much more crucial than someone who was hired within the last month.
These days, individuals are more comfortable with moving and changing careers and companies – it is unlikely that an individual will stay with a company for his or her whole life. But that doesn’t mean that key person life insurance should be obsolete. In fact, if you’re an entrepreneur or are the founder or owner of a small-to-medium-sized company, you will need this kind of life insurance to assure that your company continues to grow and thrive after you can no longer run it. If you’re the key person of your business, your health is tied directly to the health of the company.