LIFE INSURANCE: BUY-SELL FUNDING

A Buy-Sell Agreement is essential for every private practice. It guarantees the orderly transfer of ownership should one of the partners or shareholder die. It guarantees a market for the sale of the departing partner's interest in the practice and establishes a fair purchase price. The Buy-Sell Agreement should be written by the practice's attorney after the valuation of the practice by an independent expert.

There are various model for Buy-Sell Agreements, but fo the private practice, the most common one would be the Cross-Purchase Agreement. Each partner or shareholder is the owner, beneficiary and payor of the policy premiums on the lives of his or her partners. When one of the partners dies, the life insurance proceeds go to the decedent's estate and the decedent's stock in the practice in turn goes back into the remaining partner or partners according to the stipulations in the Buy-Sell Agreement.

Your InsMed reprepresentaive will assist you in determining the best possible life insurance choices to work along with your Buy-Sell Agreement.

For additional information or to schedule an appointment with an InsMed representative, please complete our online form or call us at 800-214-7039.