Where to Research / Purchase Keyman Insurance
My partner and I have been looking for keyman life insurance so one or the other could buy our equity if we were to be disabled or killed; however, finding information about a policy is difficult.
Does anyone have recommendations of a reputable, national broker or company that does this type of insurance regularly?
1 Answer
It's difficult to find, because this is the wrong way to research this problem. What you're describing is a "thrown together" business continuation plan, which will work just as well as it's constructed.
Think local, not national. It's one thing to buy your car insurance from geico.com, but this is a complex problem that requires a complex, non-commodity solution. You do not have the expertise (nor can easily attain it) to solve it on your own.
As I wrote here... find a fee-only financial advisor/consultant. They're all over, so make sure to ask for referrals from people you know. Your bank likely has one, and there are plenty of franchises of Ameriprise, Edward Jones, etc., around the country.
Not only will an FC help you with your personal/family retirement, he will be able to help you with business continuation concerns like this. He'll also be someone to go to when you have any kind of financial questions (lease vs. buy a car, etc), and will be right up there with your CPA and lawyer as far as professional advisors. And just like those professionals, they will save you much more than they cost.
You should also find a local insurance broker. If you're buying your company's insurance in this same manner (biz-insurance.com or whatever), it very likely will not work the way you think it will. Which, is a problem, since that's what's insurance is designed for.
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While I disagree with your "thrown together" assessment I will take your advice and see where that leads me. We're looking nationality because my partner and I are in different states, and we're not paying our lawyer/CPA to do it because I can't afford hundreds and hour for research. Thanks! – Kyle West 13 years ago
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@Kyle don't take this the wrong way, but this is about as "thrown together" as it can get; what do your articles of inc. say about right of first refusal? What if you disagree on "disability"? How do you determine FMV? If your company can't afford the few $K to invest in a business continuation plan, then it doesn't need one. Nothing wrong with that. – Alex Papadimoulis 13 years ago
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Alex, I'm not sure how wanting to comparison shop for an insurance policy has anything to do with the structure of our legal docs or how you could deduce the status of said docs based on me researching insurance companies and gathering quotes. The issues you raised in your comment are covered in some form or another in the docs, the thing that isn't, however, is how either of us will be able to write a seven-figure check to the other's spouse without either selling the company or having insurance. We've been advised to talk to insurance companies and purchase a policy. That is what I'm doing. – Kyle West 13 years ago
