SBA 7(a) Q&A

Who should a business identify and insure as a key person?

Short answer

A business should identify individuals whose absence would cause significant financial harm or operational disruption. This often includes owners, founders, top executives, or employees with specialized skills.

The rule

Key persons are those whose unique contributions are indispensable to the company's success. Their death could lead to a substantial drop in revenue, loss of critical clients, or an inability to complete projects, jeopardizing the business's viability.

Facts that matter

Owners, founders
Top executives
Specialized skills
Revenue generators
Irreplaceable knowledge

Example structure

For a software startup, the CEO (visionary), lead developer (product creator), and head of sales (primary revenue generator) would all be considered key persons.

What lenders usually care about

Last reviewed 2026-06-15 · SBA sources checked through 2026-06-15. DealRoom analysis of business life-insurance and SBA collateral-insurance practice (SOP 50 10 8). Not insurance, legal, or tax advice. Grounded in the current SBA rulebook; verify against the official sources above before relying on it for a live deal. Not legal, tax, or financial advice, and not an approval decision.

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