If you are looking for the best keyman insurance as well as the best critical illness insurance Singapore then you have come to the right place as here we will tell you all about keyman insurance as well as all the ways how you can decide which type of keyman insurance is best for your company and also this type of insurance will not be of debt to the company if the keyman decides to leave the company.
The company will receive the whole sum of money if the keyman is suffering from some disease and has been affected severely and needs funds for the operation that can save his life then you can take this insurance policy amount out if the funds are very necessary or if the keyman dies before the term is expired then the whole amount of money for which the policy was taken is given or handed over to the company in which the keyman was working in.
Why should you get keyman insurance for your business?
Keyman insurance money can be used for many purposes.
- This type of insurance money can be used to pay off any type of secured business loan that is either taken from a bank or a financial institution as there is an important asset on the line.
- If the business cannot continue and is in the phase of shutting down then this funds can help the company to pay the employs their salary of the month before waving them off due to the shutting down of the company.
- The proceeds of the insurance can be used to fund the process of recruitment as well as training and paying the salary of the employs it can also be used to search for another employee that has the same calibre as the previous keyman and can help the company grow.
- If a key person passes away, then all of their equity shares will be transferred to their life partner or either their family members so you can use the money gathered from the insurance policy to buy back these share from them and also at the market price.
- If the provision and the distribution or the production of your company is hampered due to the absence of funds, then you can use the money received from this insurance policy to clear all the debts and ensure the smooth working of the company.
What are the costs involved if you lose a key person?
Here is the list of the cost involved if you lose a key person.
- You will lose all the revenue that has been brought in by the key person using a different idea or a sales strategy, unlike any other.
- Your company will have to work harder so that they can complete the payment of the business debts because the key person was the only one that was able to bring the company much profit that they can pay of any debts.
- The cost of sourcing and training the employs is high, and if you lose key persona, then all this process will be hampered due to the absence of funds while it is most needed.
- You will lose all the important clients, suppliers and also the contacts from the key persona due to which the company was able to produce and deliver a high-quality product to the place to which they were ordered.
- The management structure will disrupt as funds are needed to manage all the different activities that are important for ensuring the smooth running of the business.
Who is considered as the key person of business?
These are the person who is usually classified as a key person of the business.
- Directors of the business are considered to be as the key persona of the business as they are responsible for making the decision on which the company has to act to makes their sales grow.
- Talented sales person are those people due to which the products of the company are being shown to people in the country which the company is based in and due to their good skill people tend to buy their products.
- CEO’s of the business are considered because they are people who had officially given the idea to start a business in the particular field of business that can either be sales, marketing, banking, development etc.
- Technicians are also considered as a key person as they are the people behind the machines which are making these products to perfection due to which they are being sold in huge quantities in the market.
- Business partners are also a key person as they are the people who are responsible for funding all the business activities of the business and also they are the people who introduce these company to different people in the market which will eventually help their business to grow.
How do I choose the correct key person policy?
- The first step is that you need to identify the person who is the key person due to which your business is growing so much in the market and in some policies there are conditions that the key person should be responsible for 20% of the company’s revenue.
- You should already have a plan on where you will spend the money on and also this plan will set a clear image of the places in which you have to invest money so that your business can grow even more in the particular field and there are also condition that you will have to pay tax on this policy also.
- You will have to compare all the different policies that all the company are offering and select the best one with the maximum pay and also the one in which you have to pay less tax and also less interest on.
I hope you get the information you were searching for in this article.