Shareholder / Key Employee
Companies can protect themselves from losses relating to a premature death of a key employee by purchasing a life insurance policy on their shareholders and key employees.
Buy-Sell Funding / Shareholder Agreement Obligations
When a shareholder dies, the Buy-Sell clause of a shareholder’s agreement protects the interests of the surviving shareholders and the heirs of the deceased by forcing the sale of the deceased’s shares at fair value. With properly structured life insurance, cash will be available to execute the share purchase on a tax-free basis.