Key Person Insurance for Business Owners: A Simple Guide

We spend a lot of our days asking business owners one simple, uncomfortable question: if your key person was gone yesterday —through death, disability, or serious illness— what would happen to your business today?

For small and mid-sized companies in Quebec and Ontario, the answer often exposes the true cost of lost relationships and revenue, delayed deliverables, contract and covenant risk, recruitment and training costs, operational bottlenecks, leadership gaps, and a hit to lender and investor confidence. It’s about relationships, promises, and the people who keep everything moving. That’s why key person insurance isn’t just paperwork —it’s protection for everything you’ve built.

In short: key person insurance for business funds the bridge between shock and stability.

Real client stories that show the impact

One client relied on a team of specialists. When a cancer diagnosis arrived, their insurance paid out $500,000. Their first question? “What do we do with it now?” We told them: keep people paid, keep clients happy, and take time to breathe. The team came together, and the business held steady until she returned.

A buyout saved mid-stream

Another family business faced the unthinkable during a partner buyout —a sudden loss. Thanks to key person coverage, millions came into the company right when it was needed. The family was taken care of, and so was the business. No panic, just respect for what matters.

The hard lesson of “personal only”

We’ve watched owners get by with only personal coverage. Their families were stable, but projects slipped and stress piled up. It’s a reminder: looking out for your business helps everyone involved, not just those at home.

The star salesperson

Sometimes the top salesperson is the glue. When one client lost theirs, insurance helped both the family and the company begin again —new hires, new deals, new hope.

Who is a “key person,” really?

Start at the table: who sits in the meetings where decisions and dollars move? If that person is gone, would revenue, financing, or client confidence be affected? How long would it realistically take to recruit, hire, and train a replacement to full effectiveness?

If the answer is “that would hurt,” you’ve found a key person. And they don’t have to be an owner —technical leads, operations chiefs, and heads of sales are often the hidden lynchpins that business key person insurance should cover.

Why lenders and buyers care

Lenders and buyers want to know you have a safety net. Having coverage means your payroll, rent, and projects won’t fall apart, even if you lose someone vital. That keeps credit lines and business relationships strong.

Your next step: ask the “yesterday” question

We always ask, “What would break if this person was suddenly gone?” It’s not easy, but it’s honest —and it shows where you need support.

We’re here, as mother and daughter, because we believe in helping families and businesses continue to thrive 

If you want a clear and honest plan from a team that knows how businesses operate, we’re here to build coverage that protects the company you’ve poured your time, capital, and care into —so it weathers shocks and keeps growing.



Monette Malewski, FEA, and Lianne Ulin, CHS, FEA, lead M Bacal Group as a mother–daughter team, pairing strategic risk advice with hands-on client care for families and entrepreneurs in Montréal and across Quebec and Ontario.