Corporate Insurance
Every business has several risks associated with it. It may be market fluctuations, demand and supply challenges, employee related, government policies, accidents, fire, natural calamities, etc.
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One single event can risk your whole business. But do not worry. There are insurance policies that keep your business protected. Want to know more? Read on.
Employer-Employee Insurance
The employer-employee structure is one where the company buys insurance but the beneficiary is an employee. It is a benefit given by the company to select employees. In today’s context this is particularly relevant because attracting and retaining employees is so much more difficult. The employer-employee insurance policy works as a reward program for the employees.
The insurance is also relevant for promoter run companies where the promoter would like his or her insurance expenses paid for by the company. A common tendency is to confuse employer-employee insurance with keyman. The two are very different. While keyman can only be term life cover, employer-employee structures can be used for any kind of insurances. In keyman the insurance benefit on death is paid to the company and is subject to income tax. However, in employer-employee the benefit is paid to the employee and is tax free.
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What are the benefits of the scheme to the firm and the employee?
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This concept helps the firm reduce attrition and promotes employee satisfaction. It is definitely a motivating factor for an employee when his/her employer takes insurable interest in the life of an employee. Employee gets the benefits of the insurance cover without paying for the same. The maturity or death benefits are tax free and belong to the employee.
Partnership Insurance
A business run by several parties jointly is called partnership generally the partners carry on the partnership in their own way. The partnership insurance is given to all the insurable partners in the firm if there is a partnership agreement, which declares that if any partner dies, the living partners Will have right to purchase the deceased partner's share in the firm. If all the partner of the firm are insured, the partnership firm should have enough cash available to purchase the deceased partner's share.
Entrepreneur Insurance
For most small and medium business, the entrepreneur is the key person in the business. If the entrepreneur running the business is deceased then the business suffers. There are insurance policies that cover the entrepreneur for any eventualities.
Keyman Insurance
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Keyman insurance can be defined as an insurance policy where the proposer as well as the premium payer is the employer, the life to be insured is that of the employee and the benefit, in case of a claim, goes to the employer. The keyman here would be any person employed by a company having a special skill set or substantial responsibilities and who contributes significantly to the profits of that organization.