Do Not Do Business without Life Insurance

Here is a hypothetical situation; you and your business partner co-own a small, successful business manufacturing retail goods. You employ 40 people and have grown slowly but steadily for the last 20 years. You have established vendors, distribution channels, and retail storefronts that sell your product. You and your partner agree on most aspects of business, sales are still growing, and life is good.

Then, your partner is killed in a fishing accident. Everything goes a little awry for a while, but a few months later it’s settling back down, when you receive a panicked call from your partner’s spouse. She has just discovered that your partner was making big real estate deals on the side, and his death has befouled a couple of those deals. He was leveraged and suddenly, she is in terrible debt.

Your options are to buy her out, which will leave you penniless, or sell your business, which will leave you with funds but no income. Neither outcome is particularly tenable. And as a 50% shareholder, your partner’s spouse can legitimately force you to sell if you cannot come up with a solution.

There was a way to prevent this situation before it occurred.  If only, while your partner was alive, you had purchased a Buy-Sell Agreement Life Insurance policy, your partner’s death would have provided you with enough cash to purchase his share of the business from his spouse.

It can be hard to rationalize spending money on life insurance, but when you are in business and doing well, the most important thing you can do is cover for eventualities and to ensure your business will continue to survive even if you or another key person does not. That is exactly what business owners’ life insurance is all about.  Check into it today!