Key Person Insurance is another type of employer-led life insurance policy. It is a life insurance policy taken out by a company on the life of a key employee, one who is classed as essential to the business. It helps to protect against the loss of value and profits that would occur should this key person die while in employment. The person covered under the policy should be instrumental to the operation of the company and without them, the fortunes of the company would be compromised. Unlike Employee Life Insurance, Key Person Insurance protects the business – not the individual. If the protected person does die or falls critically ill while in the employment of the company, the lump sum is paid to the company and not that person’s family.