In a previous blog, we discussed why to consider a buy-sell life insurance agreement. A buy-sell agreement in a life insurance policy helps protect other co-owners and the family of the deceased. Upon the death or departure of a co-owner, their shares are passed on to their family. Then, other co-owners can purchase those shares from the family.
Death benefits are paid to the other co-owners while the family receives a cash value for the stocks. This life insurance agreement offers a variety of benefits for the business, family, and other co-owners. If you are considering a buy-sell agreement for your business, review all of the benefits.
A Buy-Sell Agreement Offers…
When you choose to enroll in a buy-sell life insurance agreement, your death will not cease your business either. Instead, the agreement helps it continue financially. A benefit your family can expect is to have a buyer for the business right after your business. Any co-owners are likely to purchase your portions of the shares. However, your family may also want to purchase the shares. Regardless, your company will be far from instability.
Death is not the only way a buy-sell agreement triggers. You could also depart, such as retiring. This means you can receive retirement funds and start planning on your own terms. The business would not have to support you any longer as you know you get a lump-sum of money at the beginning of retirement.
It is best to ease the nerves of your lenders and banks because you’ll have greater access to credit. Once they know your business is protected with a buy-sell agreement, they can rest easy knowing your business is good hands, even after your death.
Finally, this agreement helps people you may not necessarily think about first. Your employees, customers, and suppliers can also rest easy knowing the business is not in shambles. Instead, they are more likely to stay with your business knowing it has leadership.
Consider a Buy-Sell Agreement
As you can see, a buy-sell agreement is beneficial for you, your family, your business, co-owners, employees, creditors, customers, and more. Ensure your business has a life after your death or departure by taking out a buy-sell life insurance agreement.
Contact Texas Insurance Agency today to talk about policy options. You can reach our Katy office at (281) 398-1010. You can also view the many types of commercial insurance on our website. Protect your business with the right policy.