Todd and Chris started a business together and over the years it grew into a successful enterprise. Their financial advisor recommended using whole life insurance policies to make sure that if one partner died, their family would be taken care of, and the business would survive the loss.
Todd purchased a $1 million whole life policy on Chris (and made the payments) and vice versa. Years later Todd was killed by a drunk driver. Chris received the death benefit from his life insurance policy on Todd, which he used to buy Todd’s share of the business from Todd's family.
This arrangement allowed Todd's family to be fairly compensated for his half of the business, while also allowing the business to survive without taking the major financial hit of paying off Todd's family.
This is called a buy/sell agreement and is a fairly common arrangement for small business partners.
For more information, please contact me. I will be happy to help with whatever questions you have. www.rgwealthsolutions.com +6011-51565649
Kommentare