Do you own a business? Are there some important people associated in your business other than you? Now, are these people responsible for the proper functioning of your business, so much so that without them your business might not generate desired profits? Then what happens if one of them suddenly is unable to work, unable to execute their responsibilities, for some reason or the other? Some of the extreme reasons can be their death or some severe illness that requires them to be hospitalized for a long period of time. What do you do then? To ensure that such situations do not affect the well-being of your business, the best option is to invest in a Key Man Life Insurance Policy.
What is a Key Man Life Insurance Policy?
A Key Man Life Insurance Policy is like any standard insurance policy, except in this case the policy is carried out by a particular business/company. The company takes a Key Man Life Insurance to compensate for any financial losses that can be suffered by the company in case a very important member of the company is unable to continue working, in cases such as death or severe illness, for a long period of time.
A key man of company can be any person whose specific skill set or knowledge is indispensable to the company and who is responsible for the major profits of the company. This person can be the director, a key sales manager, a key partner, a key project manager etc. The main reason such a policy is taken by the employer is to compensate for the losses that the company might suffer or compensate for the additional expenditure to hire and train a replacement (in case of death of the employee).
So, a Key Man Life Insurance Policy not only covers for death but also provides critical illness cover in UAE. So your business doesn’t need to suffer losses in case someone important falls critically ill and is unable to work for a long duration. The investment vehicle plan in UAE is simply not enough for the business to cope up with the loss of one its important employees.
Why should you opt for this?
The first and foremost reason you should opt for this insurance policy is that your company’s well-being is in your hands. You should make wise decisions for the welfare of your business so that it can stay immune during unforeseen circumstances like the death of an important business associate or employee. It is impossible to know from beforehand what might happen in the future. Therefore, it is always advisable to plan ahead and be prepared for any difficulties that might threaten the welfare of your business in the future.
Income tax recognizes the Key Man Life Insurance Policies as an important source of deduction of capital. Therefore, the premium paid for the Key Man Insurances for an employee can be claimed by the company as a business expense.