How should businesses handle key person insurance when implementing remote work or flexible work arrangements?

Remote work and flexible work arrangements generally don't impact key person insurance coverage or premiums in Australia, as the insurance protects against death, disability or critical illness regardless of where the key person works. However, several considerations ensure coverage remains appropriate. Policy disclosure should be updated if key persons permanently relocate to different states or work extensively from home, though this typically doesn't affect coverage or pricing. Insurers care more about the occupation and duties performed than the physical location. If remote work involves increased travel, particularly international travel or travel to high-risk locations, this should be disclosed as it may impact risk assessment and potentially premiums. Some policies have exclusions or limitations for claims arising during travel to certain countries. The definition and assessment of the key person's importance remains unchanged - remote work doesn't reduce their value to the business or their key person status. If anything, businesses may identify new key persons whose remote management capabilities become critical. For Total and Permanent Disability (TPD) claims, the assessment focuses on the key person's ability to perform their specific occupation duties, regardless of location. If their role is performed remotely, disability assessment considers whether they can perform those remote duties. Businesses should consider whether remote work changes business interruption impact - if remote key persons can partially continue working during illness or injury from home, this might influence appropriate coverage amounts, though most businesses maintain full coverage given uncertainty. Occupation classifications for underwriting purposes focus on actual duties and industry rather than location - a remote accountant is still classified as an accountant regardless of where they work. Regular policy reviews should confirm that coverage amounts remain appropriate given any business structure changes resulting from remote work adoption, such as reduced premises costs or changed revenue models.