Executive Income Protection Insurance Company Directors

Many people may not have heard of executive income protection insurance. This is an insurance policy that offers cover with the companies, the policy holders and the employee’s best interests at heart. It can be classed as a so called back up plan or a safety net for both employees and the business. If you were to take out a policy it protects the business from financial and other losses if something were to happen to the company’s main person becoming ill or incapable of carrying out their duties or if they died. The duties carried by this person might have a dramatic effect on the company’s survival in order for the insurance policy to pay out. Typically this sort of cover is taken out for the key person of the company just to ensure that if something was to happen to them, then in the event of a claim being submitted the benefits of the policy can be released by the insurance company and can be used to hire and temporarily replace the person you are missing.

As a lot of businesses rely so much on their staff to ensure that the business runs smoothly most companies are looking at taking out a form of company director’s income protection. This would allow the company to keep their levels of staff the same should someone unfortunately leave the company. This type of cover is typically bought for the company’s director or an employee that is thought of as being a main member of the team and an asset to the company. In the event of something like this happening, for example if a main employee was unable to work due to an unforeseen circumstance then the company can decide upon where the funds of the insurance policy can be used.

Executive income protection is very flexible and can be used in many different ways. It can be used to pay an employee that has been injured or that needs to take leave due to an injury or an ailment. A very good example of this would be if you had a key person working for your company under a contract but is not a direct employee for your company; the business can then give this key person an income protection payout.

This type of cover can be used to pay up to a maximum of 75% of the employees annual salary that they earn up until that specific employee returns back to work or are undertaking their normal everyday duties. In some cases this type of insurance can be classed as a business expense and filed as this as well.

This type of insurance is a very good option to consider for businesses, employers and employees. Always consider the pros and cons of this type of insurance and weigh up if it is beneficial or not for this type of policy.