{"id":4562,"date":"2026-10-24T02:42:42","date_gmt":"2026-10-24T02:42:42","guid":{"rendered":"https:\/\/nrcpas.com\/life-insurance-guides\/key-person-insurance\/key-person-insurance-revenue-multiple-worksheet\/"},"modified":"2026-10-29T23:21:58","modified_gmt":"2026-10-29T23:21:58","slug":"key-person-insurance-revenue-multiple-worksheet","status":"publish","type":"page","link":"https:\/\/nrcpas.com\/life-insurance-guides\/key-person-insurance\/key-person-insurance-revenue-multiple-worksheet\/","title":{"rendered":"Key Person Insurance Amount Worksheet for Business Owners"},"content":{"rendered":"\n
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Key Person Insurance | Florida Businesses<\/p>

How Much Key Person Coverage Does Your Business Need?<\/h1>

A practical worksheet from NR CPAs & Business Advisors to help Florida business owners estimate key person insurance and prepare for a coverage review. Insurance is offered by Nischay Rawal, a licensed insurance agent, separately from the firm's accounting practice.<\/p>

Call us today to schedule a coverage review<\/a><\/div>
Call us today to schedule a coverage review<\/a><\/div><\/div>\n<\/div><\/div>\n\n\n

By Nischay Rawal \u00b7 Published October 23, 2026<\/p>\n\n

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A key person insurance amount is the sum a business needs to cover the financial hit if an essential owner or employee dies. A simple worksheet gets you to a starting figure you can defend. This guide walks through it step by step for owners in Miami, Fort Lauderdale, West Palm Beach, Orlando, Tampa and Jacksonville, and for Indian-American and NRI owners with Florida business interests.<\/p>\n

What a revenue multiple can and cannot tell you<\/h2>\n

A revenue multiple gives a rough starting point. It is not an appraisal of the business or of the person. Key person insurance is a life insurance policy the business owns on an essential person, with the business as beneficiary. The Insurance Information Institute’s guide to key employee coverage<\/a> describes it as compensation for financial losses caused by a key employee’s death or disability.<\/p>\n

A multiple is a shortcut. Two companies with the same revenue can lose very different amounts when one key person leaves. The worksheet estimates a coverage amount for discussion. It does not replace the insurer’s underwriting, and the insurer sets the face amount it issues.<\/p>\n

This is an informational guide. Insurance is offered by Nischay Rawal, a licensed insurance agent, separately from the accounting practice of NR CPAs & Business Advisors.<\/p>\n\n

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If you're an owner who finished the worksheet and isn't sure the number still matches revenue, debts and the insured's role, contact our office to start. Talk it through with our team — we can walk you through how a situation like yours is usually handled and what your options are.<\/p>

Schedule a coverage review<\/a><\/div>
Schedule a coverage review<\/a><\/div><\/div>\n<\/div>\n

Gather the five inputs before you calculate<\/h2>\n

Collect five inputs before you do any math. Write down where each figure came from and the period it covers.<\/p>\n

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  1. Annual revenue tied to the person.<\/strong> Use the last full year or a clear trailing twelve months. Note which sales, accounts or projects depend on this person.<\/li>\n
  2. Gross margin and net profit.<\/strong> Measure profit before and after the insured’s pay. That shows what the company actually keeps from their work.<\/li>\n
  3. The person’s role.<\/strong> Sales relationships, technical know-how, licenses and management decisions all cost a company differently when they’re lost.<\/li>\n
  4. Replacement time.<\/strong> Estimate the months needed to hire, train and rebuild the lost output.<\/li>\n
  5. Business obligations.<\/strong> List loans, leases and lines of credit that the company must keep paying during the transition.<\/li>\n<\/ol>\n

    Keep the list short and honest. Overstated inputs produce an overstated coverage figure.<\/p>\n

    Step-by-step worksheet: from revenue to lost contribution<\/h2>\n

    Start with the revenue multiple, then check it against a profit-based estimate. Using two methods shows you where the numbers disagree.<\/p>\n

    Here is a hypothetical company. Every figure is an assumption, not a real case or a result.<\/p>\n