Succession Planning

Protect the Continuity of Your Business

As a business owner, co-owner or partner, you have a number of people that rely on your company. Customers, employees, co-owners, partners, their families and lastly your own family are all invested in your business.

With so many people counting on your business, it’s crucial to have a succession plan that can help your business survive the death of an owner, partner or key person. Without proper planning, the loss of just one person could have a severe and adverse financial impact on your business and all the people you care about.

Our business life insurance solutions are designed to protect the continuity of your business against the loss of an owner, partner or key person. Our life insurance plans can help preserve the personal wealth and business assets you have worked so hard to build.

Buy Sell Life Insurance

Protect Your Business and Your Family Against the Loss of an Owner

Planning for the loss of a business owner or partner is crucial to ensuring the continuity of your business and protecting the financial security of your family and the families of each partner or co-owner.

To protect your business, your loved ones and your co-owners or partners, you can implement what is known as a buy sell agreement, which specifies what will happen to the interests of a deceased owner, partner or shareholder. If your company’s buy sell agreement requires the surviving owners or partners to purchase the deceased’s interests, you can use life insurance rather than personal funds or business assets to fund the agreement.

For many business owners, the simplest option is to purchase a life insurance policy on the life of each co-owner or partner. In this way, funds will be available to complete a buy-out and provide the families of each partner or co-owner a secure source of funds for the value of their interest. Alternatively, the business could acquire insurance on the life of each co-owner or partner and use the insurance proceeds to purchase or redeem the deceased’s interest in the business. The structure of the buyout and insurance funding should be tailored to the objectives of the business owners.

Key Person Life Insurance

Protect the Continuity of Your Business Against the Loss of a Key Employee or Owner

Does your business include someone whose contribution is vital to your business? If yes, then this product of life insurance should be a crucial component of your business continuity and succession plan, especially if you’re a small business owner.

If an insured key employee were to die, their life insurance would provide a tax-free cash payment that your business could use as working capital and to help manage issues related to the person’s death, including:

  • Recruiting, hiring and training your employee’s replacement, which can be both time-consuming and expensive
  • Paying off debt and dealing with creditors that wish to expedite loan repayment
  • Alleviating potential lenders’ concerns about your company’s financial health
  • Reassuring customers, employees or investors that the business will continue operating.

If you or your family rely on your business as a primary source of income, key person life insurance can help ensure that the business will continue to provide a secure financial future.