Group Critical Illness Insurance - The Cheaper Alternative To Keyman Insurance.
Below is a MRR and PLR article in category Finance -> subcategory Insurance.
Group Critical Illness Insurance: A Cost-Effective Alternative to Keyman Insurance
Overview:
Small business owners often fear the impact of a team member becoming seriously ill or passing away. Beyond the personal distress, such events can severely affect business operations, resulting in decreased sales, lost skills, and a slowdown, all of which can be costly.Insurance for Small Business Risks:
Insurance offers a way to mitigate these financial risks, which can be particularly daunting for smaller businesses with limited staff. Unlike larger enterprises, small businesses can’t easily reallocate staff to cover absences, leaving gaps until the person returns or is replaced.If an employee falls seriously ill?"such as with a stroke or heart attack?"their return is unpredictable. It could take months or even years. This unpredictability forces management to decide between hiring temporary staff, outsourcing, hiring permanently, or waiting it out, each option putting financial strain on the business through increased overheads and potential lost profits.
Keyman Insurance and Its Challenges:
Traditionally, Keyman Insurance has covered these financial risks, yet 90% of small businesses don’t have it, either due to oversight or its high cost. According to Simon Briault from the Federation of Small Businesses, while it would be ideal for small firms to insure against all risks, financial realities require prioritization, leading some to take on certain risks.Enter Group Critical Illness Insurance:
A more affordable solution is Group Critical Illness Insurance, which costs about half as much as Keyman Insurance. This type of insurance allows businesses to decide which employees to cover and the amount of coverage. The business pays the premiums and receives any lump sum payout, which can be claimed once an insured employee is diagnosed with a critical illness listed in the policy. Common claims include heart attacks, strokes, and cancer among others like kidney failure and paralysis.It's important to note that a claim requires the insured employee to survive at least 28 days post-diagnosis (some insurers now offer a 14-day survival period, so it’s crucial to verify before purchasing). While Group Critical Illness Insurance isn’t as comprehensive as full Keyman Insurance, it offers considerable savings and a reasonable level of risk coverage.
Expert Opinions:
Simon Burgess, MD of British Insurance, supports Group Critical Illness Insurance as a viable alternative to Keyman Insurance. Burgess stresses that at approximately half the cost, it represents excellent value. For managers who find Keyman Insurance too costly, opting for Group Critical Illness Insurance ensures major risks are covered. Don’t let inaction cost you.In summary, Group Critical Illness Insurance offers a balanced, cost-effective solution for small businesses to protect against the financial impact of serious employee illnesses, making it an intelligent choice for budget-conscious managers.
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