What happens to key person insurance coverage when a business expands interstate or internationally?

Business expansion interstate within Australia typically doesn't affect existing key person insurance policies, as Australian insurers provide coverage nationally regardless of where the key person works or where business operations are located. The policies remain valid whether the key person relocates from Sydney to Perth or whether the business opens branches across multiple states. No policy amendments are usually required for interstate expansion, though insurers should be notified of significant business changes during annual reviews. However, international expansion creates more complex considerations. Most Australian key person insurance policies cover key persons globally for death claims - if an Australian-based key person covered by Australian insurance dies overseas, claims are generally paid. For disability, trauma and income protection benefits, coverage may have geographic restrictions. Policies typically cover disabilities occurring anywhere but may require the key person to be assessed under Australian medical definitions and potentially return to Australia for assessment. If a key person relocates permanently overseas to manage international operations, insurers may have concerns about policy continuation, particularly for disability and trauma components. Some insurers impose premium loadings for key persons working in high-risk countries or may exclude certain geographic regions from coverage. If the business establishes permanent international operations with local key persons employed overseas, local insurance in those jurisdictions is typically required as Australian policies won't cover foreign nationals or permanent overseas residents. For multinational businesses with key persons in multiple countries, a combination of Australian and local insurance policies provides comprehensive protection, with coordination to avoid coverage gaps or unnecessary duplication. Notification to insurers about international expansion, key person relocations, or overseas work is essential to maintain coverage validity.