Business Insurance

The Canadian business insurance market holds tremendous potential for the professional life insurance advisor, especially with the rapid growth in the number of smaller businesses in the past decade. Today, there are more than a million entrepreneurial businesses in Canada whose principals depend on the advisors like you to help them achieve their financial goals.

What happens to a business when a key employee; a top salesperson, manager, partner or product developer suddenly dies? The business could be in serious jeopardy, unless it implements a sound financial plan.

Key person insurance is an integral part of planning for every business. No matter how small, if planned appropriately, it can protect the business against financial hardship if a key employee dies. Often the survival of a business after such a loss is dependent upon this insurance. Fortunately, the process of implementing key person insurance is relatively easy.

Determining the type of key person insurance and the amount needed depends upon the business and the employee insured. There are three approaches to key person insurance:

Approach 1: Company owns the policy and is designated the beneficiary to receive proceeds of the face amount and cash value on the death of the key person.

Approach 2: Key person and company jointly own policy on a reverse split dollar basis – key person pays premiums for and controls the interests in the policy related to the cash value and the company pays the premiums for and controls the interests in the policy related to the face amount.

Approach 3: Key person and company jointly own policy on a split dollar basis – company pays premiums for and controls the interests in the policy related to the cash value and key person pays premiums for and controls the interests in the policy related to the face amount.

Contact us, we believe we can cater to your needs in an effective and ethical manner.