Key Man/Buy Sell

Key Man Insurance Review

Key person life insurance can help offer improved confidence in knowing that the financial stability of your business is protected in the event of a valued employee's untimely death.

Buy Sell Insurance Review

When using life insurance with a buy-sell agreement, either the company or the individual co-owners buy life insurance policies on the lives of each co-owner. In the event of a death, the policy owners receive the death benefits. That money is paid to your surviving family members as payment for your interest in the business. Your family gets a sum of cash they can use to help sustain them after your death, and the company has ensured its continuity.

Advantages of using life insurance in a buy-sell agreement:

• Life insurance creates a lump sum of cash to fund the buy-sell agreement at death
• Life insurance proceeds are usually paid quickly after your death, ensuring that the buy-sell transaction can be settled quickly
• Life insurance proceeds are generally income tax free; a C corporation may be subject to the alternative minimum tax (AMT)
• If sufficient cash values have built up within the policies, the funds can be accessed to purchase your business interest following your retirement or disability