What Is Key Person Insurance? Guide for Business Owners (2026) - Shopify

What is key person or key man insurance and why is it important? Key person insurance, also known as key man insurance, is a life or disability insurance policy owned by a business on a critical employee such as a CFO, COO, or other key leader. It helps compensate the company for financial loss and transition costs if that individual passes away or becomes disabled. While key person insurance premiums are generally not tax-deductible, the coverage plays an important role in maintaining business

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Key Person Insurance