How a Single Policy Can Benefit Your Business in Three Ways
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Losing quality employees is a business risk that can be managed. In fact, a single business-owned life insurance policy can form the core of a plan to retain your most prized assets: your people. Here are three ways a life insurance policy can help mitigate the risk associated with losing valuable team members:
Key Person Protection
In the event of a key employee’s death, a life insurance policy can provide funds to cover the costs associated with recruiting, hiring, and training a qualified replacement. The proceeds can also be used for business continuation or overhead expenses.
Private Bonus Plan
A private bonus plan, funded with the cash value of the life insurance policy, gives employees a strong incentive to stay with your business. You can design a private bonus program that pays select employees set bonuses in specific years. As the business owner, you get to decide when and what amount of bonus should be given. The build-up of cash value inside of the life insurance policy funds the bonus payments.
Family Protection
A life insurance policy can also provide personal protection for the employee’s family. With the right documentation, the death benefit on the policy used for the bonuses is split between the business and a personal beneficiary. This personal protection may give the insured’s family some additional financial support and security at a difficult time.
Life insurance can help you proactively give employees an incentive to stay committed to your business, and you peace of mind that comes from knowing that your business is better protected should you lose a key team member. Contact your Federated® marketing representative for more information.
