Keyman Insurance
Protect your business if you lose a key person
If your company depends on one or two people, their sudden death or serious illness could put everything at risk. Keyman insurance pays your business a lump sum so it can keep trading, replace lost income and protect jobs.
Last reviewed by Debbie Cheevers, QFA, RPA · 29 June 2026
Who keyman insurance is for
Company directors and owners
If the business would struggle without you or a co-director, cover protects the company you’ve built.
Firms that rely on a few key people
A top salesperson, a technical expert or a founder whose knowledge and client relationships drive your profits.
Businesses with loans or investors
If you have business borrowings or backers, a payout can clear debt and reassure the people who rely on you.
What is keyman insurance?
Cover that protects the business, not the family
Key person insurance — often called keyman insurance — is a policy a company takes out on the life, and sometimes the health, of an employee or director who is vital to the business.
The company pays the premiums and the company is the beneficiary. If that person dies, or on some policies becomes seriously ill, the insurer pays a lump sum straight to the business.
Why it matters in Ireland
Many Irish businesses are built around a small number of people with specialist skills, key client relationships or hard-to-replace experience.
The more the company leans on those individuals, the bigger the financial hole their loss would leave. Keyman cover fills that hole so the business has time to recover.
The risk is real
How likely is it that you’ll lose a key person?
The chance that at least one key person dies before age 65 climbs quickly as your team grows:
| Key people in the firm | Chance one dies before age 65 |
|---|---|
| 2 | 18%
|
| 3 | 25%
|
| 4 | 32%
|
| 5 | 39%
|
| 6 | 44%
|
| 7 | 50%
|
| 8 | 54%
|
Illustrative figures based on standard mortality assumptions. Your own risk depends on the ages and health of the people involved.
What keyman insurance protects
A payout gives your business breathing room at the worst possible time. It can help you:
Keep the business stable
Replace lost profits and cover day-to-day running costs while the company finds its feet again.
Recruit and train a replacement
Fund the cost of finding the right person and getting them up to speed, without cutting corners.
Reassure lenders and investors
Show banks, backers and suppliers that the business can still meet its commitments after a serious loss.
Protect jobs and relationships
Give staff, customers and partners the confidence that the company will keep going.
How keyman insurance works
1. Identify your key people
Decide whose loss would hit hardest — usually a director, founder or someone with rare skills or key client relationships.
2. Work out the cover
A common starting point is 10–15 times the person’s salary or the profit they generate, plus any business loans you’d want repaid.
3. Apply and underwrite
The insurer assesses the person’s age, health and role. We handle the paperwork and find the right provider for you.
4. Pay premiums and claim if needed
The company pays the premiums. If the worst happens, the business claims and receives a lump sum to use as it needs.
How keyman insurance is taxed in Ireland
The premiums
Premiums can sometimes be treated as an allowable business expense — but only where strict Revenue conditions are met. In broad terms the cover must be short-term life assurance taken out purely to protect against a loss of profits, and the key person must not have a substantial stake in the company.
The payout
Where premiums have been allowed as a deduction, any payout is normally taxable as a trading receipt. Where the policy does not meet the conditions for relief, the treatment is different again — so it pays to set the policy up correctly from the start.
Tax treatment depends on your exact circumstances and on Revenue rules, which can change (correct as at 2026). This is general information, not tax advice — we’ll confirm how the rules apply to your business before you commit.
Our four-step advice process
- 1
Free consultation
We get to know your business, your key people and what you would need to protect.
- 2
Assess the risk
We work out who is critical, how much cover makes sense and how best to structure it.
- 3
Recommend cover
We compare Ireland’s leading insurers and recommend the right policy and provider for you.
- 4
Set up and review
We put the cover in place and review it as your business grows or changes.
Frequently asked questions
Can keyman insurance be transferred if the key person leaves?
Usually not. The policy is tied to a specific person and underwritten on them individually, so it can’t simply be moved to someone else. If a key person leaves, you would normally stop that cover and arrange a new policy on their replacement.
What happens if my business changes significantly?
Cover should keep pace with the business. If you grow, take on new key people, repay loans or restructure, we’ll review your policy and adjust the cover so it still matches the risk.
Does the key person’s age or health affect the payout?
Age and health affect the premium, not the agreed payout. Once a policy is in place the insurer pays the sum assured you set up, regardless of how the person’s health changes later.
How quickly is a claim paid?
Once the insurer has the documents it needs and the claim is verified, payouts are usually made fairly quickly. Setting the cover up properly in advance is the best way to avoid delays.
Can I cover more than one key person?
Yes. Many businesses hold separate policies for each key person, each sized to that individual’s importance to the company.
Can keyman cover include serious illness?
Many policies can add specified-illness cover, so the business is also protected if a key person survives a serious illness but can’t work for a long period. We’ll explain the options.
We work with Ireland’s leading protection providers
Ian was so helpful with the information I needed to put me on the right track — sent everything by email afterwards so it was easy to understand. Highly recommend.
Protect what you’ve built
Talk to a Greenway adviser about keyman insurance for your business. The first consultation is free and there’s no obligation.
Last reviewed by Debbie Cheevers, QFA, RPA, 29 June 2026. Information is general and not personalised financial advice.