A business critical illness insurance policy is purchased by the company/employer on the life of a partner or an employee whose critical illness would have adverse effects on the company. The objective of key person insurance is to financially protect the company from any impact or financial loss should anything happen to its most valuable employees.
Depending on the insurance company, the following is a list of covered conditions:
- Cancer
- Heart attack
- Stroke
- Coronary Artery Bypass
- Multiple Sclerosis
- Parkinson’s
- Major Organ Transplant
- Paralysis
- Bacterial Meningitis
- Coma
- Aplastic Anaemia
- Alzheimer’s
- Renal (Kidney) Failure
- Blindness
- Loss of Speech
- Loss of Limbs
- Deafness
- Severe Burns
- Occupational HIV
- Benign brain tumor
- Aortic Surgery
- Loss of Independent Existence
- Motor Neuron Disease (Including ALS)
- Heart Valve Replacement
Business Critical Illness insurance is set up so that the company is the owner and in the event an employee is diagnosed with a critical illness, the benefit will be paid to the company for the losses they will suffer by losing an employee during their recovery time. Since the company is the owner, it is also responsible for the payment of the insurance premiums. Premiums are not tax-deductible; therefore, the benefit is received tax-free.