Life Insurance Series
Life · For Business
Life Insurance Strategies
for Business Owners
For business owners, life insurance does more than family protection. It funds buyouts, retention, and continuity — and it can do all that with tax advantages that personal life insurance can't touch.
of family businesses fail to transition to the next generation
Often because of a single uninsured event — the death or disability of a key owner. A funded buy-sell agreement is the difference between continuity and forced sale.
Four ways businesses use life insurance
Key Person Insurance
The business owns a policy on a critical employee (often the founder or rainmaker). If they die, the business receives the death benefit to weather the disruption — replace them, pay debts, or buy out their family.
Buy-Sell Agreement Funding
Co-owners insure each other. When one dies, the surviving owners receive a death benefit large enough to buy out the deceased's share at a pre-agreed price. Without this, families end up as unwilling business partners.
Executive Bonus Plan
Company pays premium on a life insurance policy owned by a key executive. The executive owns the cash value and death benefit, but the premium counts as taxable bonus income. Tax-efficient executive retention tool.
Section 162 Plan
Similar to Executive Bonus but with more flexibility — typically used for executives in C-corps. Cash value grows tax-deferred, and the policy can supplement retirement income.
The buy-sell trap most partnerships fall into
Most partnerships HAVE a buy-sell agreement. Very few have it FUNDED. An unfunded buy-sell is just a piece of paper that says "the surviving partners will buy out the deceased's share." If those partners don't have the cash, the family becomes an unwilling partner — or the business ends up sold at a fire-sale price.
Life insurance — sized to the agreed buyout price — is what makes the agreement actually work.
Own a business? Let's stress-test what happens if you can't run it.
We'll work with your CPA and attorney to structure key-person coverage, buy-sell funding, and retention plans that actually pay out when needed.
Carriers We Represent
We're independent — we shop the market for the policy that fits, not the highest commission.
Carrier logos shown are trademarks of their respective owners. We work with additional regional carriers — ask about a specific plan.
Common questions
What is key person life insurance?
A policy the business owns on someone whose loss would hurt revenue. The business is the beneficiary and uses the money to recover, hire, or pay debts.
How does life insurance fund a buy sell agreement?
Each owner is insured, and when one dies the proceeds buy that owner's share from the family at an agreed price. It keeps the business with the surviving owners and gives the family cash.
What is an executive bonus plan?
The business pays the premium on a policy the employee owns, and treats it as bonus pay. The employee gets the policy, the business gets a deduction and a retention tool.
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