Every business nowadays understands how vital key man life insurance policies and disability policies are. For those who are new to this concept, disability insurance provides benefits in case of disability of a business owner.
So, how does one go about buying such type of insurance and what are the important points to bear in mind before arriving at a decision as which policy to buy? Below mentioned are a few factors that you need to keep in mind to select the best key man life insurance policy.
Nowadays, many firms in the market offer both key man life insurance policy and disability policy. One could personally visit these firms and select an appropriate policy. One important consideration to bear in mind is to check the benefits, terms and conditions. It is never a wise move to just get quotes on a few similar sounding policies and purchase the cheapest one.
An individual should make sure that he/she is aware of all the details related to the policy. For example, these policies often have several terms that one must be careful of before taking the plunge. These policies are a little complex than standard life insurance policies. One should never hesitate asking the agent about any query regarding the policy. One can also check online to find different aspects of a key man life insurance policy.
A key man life insurance plan is of two types namely the term-life plan or the permanent-life plan. A term policy provides only insurance. The benefits are comparatively higher than a permanent-life plan. However, one is not entitled to receive money at the end of the term. This means benefits arise only in the event of the insured key person’s demise. In contrast, a permanent-life plan policy returns some cash at the time of surrendering the policy. As a rule, term policies are a lot more affordable. One can get a relatively large cover at the cost of a low premium. Businesses usually need a large cover. They do not look at insurance as an investment that must yield positive returns. This is why financial advisors often recommend term policies to businesses.
However, factors like age and overall health conditions have an influence on the policy. This affects the choice of plan. In order to work out how much cover to obtain, one needs to ascertain what part of the company’s income will be affected in the event of a tragic loss of the key person, most often the business owner.
In case of a disability policy, you first need to understand that the government aid provided in case a person cannot go to work due to illness or injuries is often too little to survive. Thus, one not just needs to buy a disability policy to ensure that you get adequate cover. One should never procrastinate purchasing a disability policy. Remember, that in case of disability of a business owner or prime shareholder, a company’s fortunes can be seriously affected. However, you will still need to meet payrolls, your medical expenses and so forth. Add to it your living expenses in the light of inflationary trends and you understand how vital it is to get key man life insurance.
So, how does one go about buying such type of insurance and what are the important points to bear in mind before arriving at a decision as which policy to buy? Below mentioned are a few factors that you need to keep in mind to select the best key man life insurance policy.
Nowadays, many firms in the market offer both key man life insurance policy and disability policy. One could personally visit these firms and select an appropriate policy. One important consideration to bear in mind is to check the benefits, terms and conditions. It is never a wise move to just get quotes on a few similar sounding policies and purchase the cheapest one.
An individual should make sure that he/she is aware of all the details related to the policy. For example, these policies often have several terms that one must be careful of before taking the plunge. These policies are a little complex than standard life insurance policies. One should never hesitate asking the agent about any query regarding the policy. One can also check online to find different aspects of a key man life insurance policy.
A key man life insurance plan is of two types namely the term-life plan or the permanent-life plan. A term policy provides only insurance. The benefits are comparatively higher than a permanent-life plan. However, one is not entitled to receive money at the end of the term. This means benefits arise only in the event of the insured key person’s demise. In contrast, a permanent-life plan policy returns some cash at the time of surrendering the policy. As a rule, term policies are a lot more affordable. One can get a relatively large cover at the cost of a low premium. Businesses usually need a large cover. They do not look at insurance as an investment that must yield positive returns. This is why financial advisors often recommend term policies to businesses.
However, factors like age and overall health conditions have an influence on the policy. This affects the choice of plan. In order to work out how much cover to obtain, one needs to ascertain what part of the company’s income will be affected in the event of a tragic loss of the key person, most often the business owner.
In case of a disability policy, you first need to understand that the government aid provided in case a person cannot go to work due to illness or injuries is often too little to survive. Thus, one not just needs to buy a disability policy to ensure that you get adequate cover. One should never procrastinate purchasing a disability policy. Remember, that in case of disability of a business owner or prime shareholder, a company’s fortunes can be seriously affected. However, you will still need to meet payrolls, your medical expenses and so forth. Add to it your living expenses in the light of inflationary trends and you understand how vital it is to get key man life insurance.
