Funding a Disability Buy-Sell – Part 2
Type of Agreement The Insurable Interest
The Buy-Sell Such an agreement demands that a disabled business owner must sell his/her ownership in a firm to the non-disabled owner(s), and the nondisabled owner(s) must buy at the price established by the agreement.
The Buy Out A person contracts to buy out the business ownership of another person. The seller may require insurance on the buyer to offset the contingency of disability which could render the buyer financially unable to complete the purchase.
The Buy-In A person contracts to buy ownership in a business. The buyer may insure against becoming disabled and being unable to complete the purchase.