Michael Saltstein Explains Why You Should Get Keyman Insurance

During these trying times, Michael Saltstein believes one of the vital questions a company should constantly ask is if the company can survive if a key employee dies unexpectedly. Although it's hard to even consider, the death or long-term absence of a valued employee can come at the most unexpected and crucial times in the development of a company. So, it is best to plan for the worst-case situation, and Michael believes one of the best ways to do so is to get a keyman insurance policy.

Individual skills are becoming increasingly vital to a business's success, and employees are also becoming a key component in investors' entity valuation. So, besides the owners and operators, Michael Saltstein believes every organization has at least a few highly valued employees who contribute considerably to the company's operation and growth. At this point, keyman insurance comes into play because of the possibility of a business/financial loss if such key employees died unexpectedly.

Keyman insurance assists a firm in recovering from the loss of its most precious assets - the people who operate and own it. It makes it reasonable to protect yourself in the tragic case of their untimely death.

The main goal of key person insurance is to assist a small business in the event of the death or disability of the owner or a key employee. Typically, you would buy a life or disability insurance policy and name your family members as beneficiaries. So, the insured person in a key person insurance policy is the owner and beneficiary of the policy. On the other hand, the owner or executive critical to the firm's operation is the policy's insured person.

In addition to their other contributions, the disruption of company credit lines due to the keyman's death can also leave a negative impact on the firm. So, in this situation, the insurance money can serve as a guarantee of loan repayment in the event of the critical person's death.

According to Michael Saltstein, keyman insurance will aid in keeping the market price of the company's shares stable in the event of the keyman's death. Of course, if the keyman dies, the cost of the company's shares is also likely to fall, but if investors know that insurance proceeds can offset any financial loss, they may not sell the shares right away.