Buy Sell Agreement Life Insurance Template

Buy sell agreement the sample buy sell agreement below is for information purposes only.

Buy sell agreement life insurance template. An insured buy sell agreement triggered buyout is funded with life insurance on the participating owners lives is often recommended by business succession specialists and financial planners to ensure that the buy sell arrangement is well funded and to guarantee that there will be money when the buy sell event is triggered. Life insurance is an effective tool that business owners can use to implement the provisions of a buy sell agreement by providing liquidity at the death of an owner to both his or her business and family. One partner owns 50 percent of the company while the other two partners own 25 percent each. We recently worked with three entrepreneurs that needed life insurance to fund their buy sell agreement. Plus the cost is small compared to the benefits.

Individual disability insurance policy as confirmed by an insurance company or. For some partners the only way to fully fund the agreement is with life insurance. Buy sell agreement pdf sample the sample buy sell agreement below details an agreement between the shareholders of abc inc regarding the buying and selling of shares of the company. A buy sell agreement fully funded with life insurance can be an invaluable tool in helping business owners establish a price for their share of the business secure a buyer and ensure that the money to purchase the interest is there when the need arises. It is very important to fully fund your buy sell agreement.

Neither meg financial inc. Nor any of its representatives offers legal or tax advice. Buy sell agreement with life insurance example. The buy sell agreement protects the business and the remaining business owners from ramifications of an owner s personal life that can impact the company. This means that the buy sell agreement can be settled much faster.

Buy sell agreements are critical when dealing with a closely held business and yet often ignored or given short shrift by business owners. The company may acquire such amounts of life insurance on the lives of the owners as it deems appropriate to enable it to purchase offered units. To learn more about your options contact a licensed true blue life insurance professional at 1 866 816 2100. This contract creates a plan that enables the surviving partner to purchase the deceased s share in the business typically using the funds of a life insurance policy. Please consult your tax and legal professionals concerning structuring a buy sell agreement.

A buy sell agreement funded with life insurance will give you the confidence that your business and your family will be taken care of in your absence. Permanent life products will build cash values that can be used when a partner is disabled or retires. The business is worth about 8 million dollars.