Page 28 - IC24 LEGAL ASPECTS OF LIFE ASSURANCE

The purpose of key man insurance is to indemnify a business

firm for the loss of earning resulting from the death of a

valuable and important employee.

Moneys payable under key man insurance can be treated as

capital payments or revenue income and accordingly the

appropriate Section of the Income Tax Act can be applied for

tax treatment.

Partnership is the relationship between persons who have

agreed to share the profits of a business carried on by all or

any of them acting for all.

Partnership insurance provides funds to surviving partners to

purchase the share of the deceased partner in the event of the

partnership being dissolved by the death of any partner.