The success of a business may hinge on ideas and leadership provided by a key executive. The sudden death of such an executive may have a severe economic impact on the business because it loses that person’s unique skill, abilities, and relationships. It also has the potential to weaken a company’s credit rating. As a result, the business may have to spend considerable amounts of money to recruit or train a replacement executive.
A strategy that includes key person life insurance can help during the transition period following the death of a key executive. Through the purchase of life insurance on that key person, the business can financially protect itself: The death benefit can provide the necessary liquidity to not only find a suitable replacement but it can also be used to help prevent a disruption in sales or production. If a cash value policy is used, a business may access the cash value for emergencies or other financial needs.
These plans can help buy your company time to continue operating while making sudden but unavoidable upper-level management changes.
Assurance, tax, and consulting offered through Moss Adams LLP. Investment advisory services offered through Moss Adams Wealth Advisors LLC. Insurance offered through Valmark Securities Inc. (VSI), member FINRA & SIPC. VSI is a separate entity from Moss Adams.
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