Business owners & partners
Fund the buy-sell agreement before you need it
A buy-sell agreement says who buys an owner's interest and at what price. Life insurance is often what makes the money actually exist when the triggering event arrives.
Who this is for
Co-owners, partners, and family businesses with an existing or planned buy-sell agreement, or owners thinking about succession.
See how this applies to entrepreneurs.
The problem
Many buy-sell agreements are unfunded or reference valuations that are years out of date. When an owner dies, the surviving owners may not have cash to buy the interest — and the family may be left holding an illiquid stake they can't sell.
How it works
- Your attorney drafts or updates the agreement; we design coverage to match its structure.
- In a cross-purchase arrangement, each owner holds coverage on the others; in an entity redemption, the business owns the policies.
- At death, proceeds fund the purchase at the agreed price, transferring the interest to surviving owners and cash to the family.
- Coverage is reviewed as the business value changes so funding keeps pace with the agreement.
Common use cases
- Two to five partners with a cross-purchase agreement
- A family business transferring to active children while treating inactive heirs fairly
- An owner planning a gradual internal sale to key employees
- Updating an old agreement whose valuation no longer reflects reality
Important considerations
- The structure of the agreement (cross-purchase vs. redemption) affects ownership, basis, and tax outcomes — your attorney and CPA should lead those decisions.
- Disability and retirement triggers may need separate funding approaches.
- Owners of different ages or health can create premium imbalances that should be addressed in the agreement.
- We do not draft legal agreements or provide tax advice.
How American Dream Solutions helps
We work alongside your attorney and CPA to size coverage to the agreement, model ownership structures, and place coverage with carriers suited to each owner's underwriting profile.
Independent and licensed in all 50 states, with access to 30+ carrier partners. Read more about the firm or review example case studies.
Learn more in our guides
Indexed Universal Life for Business Owners
How IUL is actually used in business-owner planning — key-person cover, buy-sell funding, supplemental retirement income — and where illustrations oversell.
Life Insurance for Estate Liquidity & Wealth Transfer
Why illiquid estates force bad sales, how second-to-die and trust-owned coverage solve the timing problem, and what to coordinate with counsel and CPAs.
Related services
What to expect
The first conversation is a no-obligation conversation. We ask about your goals, income, and existing coverage, explain the options that may fit, and tell you plainly if something isn't a fit. There's no application and no pressure.