Buy-Sell Insurance

If you, or your business partner dies, becomes disabled, or retires, what will happen to your business? Will it be left to your family, who may not be able run it? Will your partner be stuck trying to buy them out to maintain control? Obviously, you would like to make sure that your business continues to run smoothly if something happens to one of it's owners. In either case, business insurance in the form of key man or buy/sell life insurance can save the company and your family the strain of trying to figure out what to do with their inherited new career.

A buy-sell agreement will make sure that the interests of a company's owners will be legally protected if something tragic and unexpected happens. It also allows for the business to continue to operate in the event of the death, disability, or retirement of a business owner. A buy-sell agreement can by adopted by all forms of companies including, partnerships, limited liability companies, and corporations. A buy-sell plan can be thought of as a written agreement to help a business navigate a successful business transition.

Buy/sell agreements can come in a variety of forms, such as:

• Stock Redemption Plan
  A Stock Redemption Plan is an agreement in which owners and partners agree to sell their ownership interest back to the company if they become disabled or wish to retire. If there is a death of an owner, the owner’s estate is required to sell the deceased owner’s interest back to the company.
• Cross-Purchase Agreement
  A Cross-Purchase Agreement is a written agreement among the company partners or stockholders to purchase each other’s shares at the disability, retirement or death of a business owner.
• Wait-and-See, Buy-Sell Agreement
  A Wait-and-See Agreement allows business owners to delay the selection of a buy/sell agreement until an actual death, disability, retirement or sale of a business interest