As a business owner with one or more partners, have you ever considered what would happen if one of the partner’s died suddenly.
- How much is the business worth?
- How will we or I buy my partners share?
- If his/her spouse wants to remain a partner in the business how will we get along?
- Will I be forced to sell?
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A Buy/Sell agreement takes care of all your worries by putting the worth of the business on paper and evaluating it as often as every year to several years to maintain adequate protection. An insurance contract is purchased to cover each partners interest in the business so there won’t be any disagreements later. |
Another form of Business continuation coverage is Key man coverage. This form of coverage is usually provided while one of the partners of the group is a Major draw for the practice, such as law firm, medical practice, if that person should suddenly die. |
The value of the practice would suffer severely. Therefore the remaining partners may never regain the value of their practice. |
Key man coverage provides a policy on that individual that is truly the backbone of the practice so that if anything should happen the remaining partners financial interests would be protected. |