Buy and Sell Cover

If you are a co-owner in a business, you need to think about the consequences should you or any of your fellow co-owners pass away. If you are the one to pass away, it will most likely leave your estate severely exposed, and the remaining owners could also face potential problems.

The purpose of a buy-and-sell agreement is to provide the surviving co-owners with cash to purchase the interest of a deceased co-owner. According to the agreement, each co-owner takes out life cover on the other co-owners’ lives. The life cover pays out on the death of a co-owner, which funds the purchase of his or her interest by the surviving co-owner(s).
In the same way, disability cover can be included to fund the buyout of a disabled owner’s share of the business.