Business Insurance
Fund your buy-sell agreement so it actually works when you need it.
A buy-sell agreement without funding is just a piece of paper. Life insurance is the most common and cost-effective way to ensure your buy-sell actually has the cash to execute when a partner dies, becomes disabled, or exits.
✓ Independent & fiduciary ✓ 40+ A-rated carriers ✓ No sales pressure ✓ CFA charterholder
At a Glance
Buy-Sell Agreement Funding — the essentials.
Purpose
Guarantees cash for ownership transfer
Common Structures
Cross-purchase or entity redemption
Typical Funding
Life insurance + disability buyout
Best For
Partnerships, multi-owner businesses
Who Is This For
Is buy-sell agreement funding right for you?
- Any business with two or more owners
- Partnerships where each partner's share has significant value
- Companies where the death or disability of an owner would trigger a buyout
- Businesses that want to keep ownership within the current partner group
For Texas Business Owners
Most business owners have a buy-sell agreement. Very few have it properly funded. When a partner dies, the surviving partners need immediate cash to buy out the deceased partner's share. Without insurance, you're liquidating assets or taking on debt at the worst possible time.
Honest Assessment
When it works — and when it doesn't.
We're a fiduciary. That means we tell you when a product isn't right for you.
● When it makes sense
- You have a buy-sell agreement but no dedicated funding source
- Your current funding is outdated — the business has grown since you last reviewed it
- You're forming a new partnership and want to do it right from the start
- A partner is approaching retirement and you need a succession plan
● When it doesn't
- You're a sole proprietor with no partners
- Your buy-sell is already adequately funded and recently reviewed
- The business has enough liquid reserves to self-fund a buyout
Common Questions
What you're probably wondering.
What's the difference between cross-purchase and entity redemption? +
In a cross-purchase arrangement, each partner buys insurance on the other partners. In entity redemption, the business buys insurance on all partners. Cross-purchase gives surviving partners a stepped-up tax basis. We'll recommend the right structure for your situation.
How much coverage do we need? +
Coverage should match each partner's ownership share value. If the business is worth $5M and you own 50%, you need $2.5M in coverage. This should be reviewed annually as the business grows.
What if we have more than two partners? +
Cross-purchase gets complex with 3+ partners (each partner needs a policy on every other partner). A trusteed cross-purchase or entity redemption simplifies things. We'll design the right structure.
Should we use term or permanent insurance? +
If partners plan to exit within 10–20 years, term is most cost-effective. If the partnership is expected to continue indefinitely, permanent coverage (whole life or UL) avoids the risk of outliving your coverage. Many clients use a blend.
Industry Insights
See how this applies to your industry.
Ready to find the right buy-sell agreement funding?
30-minute conversation. No pressure. We'll look at your specific situation and find the best option across 40+ carriers.