Key person insurance, also called key man insurance, can be thought of as a hybrid between business insurance and life insurance. Companies can take out this type of insurance on the lives of certain employees to cover the risk of losing “key” workers. The company pays the insurance premium, and if the covered employee dies, the business collects the death benefit. Key person insurance can also be structured as a disability policy if the employee becomes disabled. Investors and lenders may require a key person policy to provide for business continuity. Key person insurance can be used in partnership buyouts as well.