This can be especially important to smaller companies whose reliance on key individuals may be greater than larger corporate entities. There are two main types of business assurance; Key Man and Partnership/Director Share Purchase:
Used to inject a lump sum of cash into the business in the event of the loss of a 'Key Person'. A key person would be someone whose death would have a direct and adverse effect on the companies' income (and therefore profitability).
Used to protect the families of Directors and co-owners of the business in the event of the death of one of the Partners/Directors. Each party agrees beforehand the value of his or her share and a combination of Term Assurance policies and legal documents are put in place. This ensures in the event of a partner or shareholders death, that the remaining co-owners have a sum of money in place which will enable them to 'buy out' the family of the deceased.