Business Life Insurance Law and Legal Definition

Business life insurance is life insurance bought by a company or investor on the life of persons who are critical to the life of the company. It ensures the continued function of a company in the event of death of a key person within the organization. It provides coverage that can help to overcome the company from its difficult situation when an owner or a key executive is no longer around to handle his/her usual responsibilities. The beneficiary of a business life insurance is usually the company. The proceeds from a business life insurance proceeds can also be used to cover the expenses of obtaining consultants and other temporary services. It is also called as key person insurance.

Business life insurance is important for smaller companies, partnerships, and sole proprietorships. In a partnership business, business life insurance can help the surviving partner or the beneficiaries of the deceased proprietor to have resources that will keep the business on an even projection.