“Buy/Sell Plus” Insurance

The total disablement of a business owner is a major cause of an established business’ untimely and premature demise. Insurance advisors and agents have various products at their disposal to help combat the financially destructive forces of corporate disability. Regarding business continuation and the transfer of ownership of that business to existing or new partners in case of the owner’s disability, the most important risk diffusing coverage is buy/sell permanent disability insurance.
Buy/sell disability insurance funds the exchange of corporate ownership from one party to one or more other parties at the time of the first party’s total and permanent disablement. The obvious shortcoming of traditional buy/sell insurance is found in the policy’s elimination or waiting period. Most buy/sell insurance programs require that the insured be medically deemed totally disabled for a time period of at least 365 days and up to 730 days before the buy/sell is funded through the disability policy in accordance with a proper buy/sell contractual agreement. However, many problems may arise during that 12 to 24 month waiting period.

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