As a business owner there are a number of problems that arise when a shareholder or key man dies. These problems can continue for the corporation beyond the death of the owner as the corporation will continue. In the early phases of a business, term assurance may be useful, but in many circumstances permanent life insurance becomes attractive because of the lower corporate tax rates.

As a business owner, have you asked yourself the following questions?

Small and medium size corporations

If another shareholder dies?

1. If another shareholder dies do I want to acquire his stock and continue the business, without resistance from inactive stockholders heirs, who are more interested in continuing income than running the business?
2. Is there a buy-sell agreement in place to affect change of ownership? At what price, and how will the share transfer be funded? 

 In the case of your death?

1. When I die, will there be a guaranteed market for my shares, if my heirs no longer want to continue in the business?
2. Do you want your family to get the going concern value of the business or a fire sale value, because the person responsible for its successful operation has died?
3. If you want your family to retain their stock and continue the business, will there be enough money in the business to enable your heirs to successfully manage it?
4. Is there a buy-sell agreement in place to affect change of ownership? At what price, and how will the share transfer be funded? 

Key man Needs

1. How will the loss of a key person affect your business profits and credit line?
2. How much money would you need to reduce the impact of the loss of a key man?

Corporate Insured Retirement Plans

1. How can the corporation accumulate enough surplus funds to pay for your retirement when corporate tax rates on invested capital are so high?
2. How can my family get tax-free money out of the business when I die? And is there a way I can use corporate dollars to reduce capital gains taxes?

For all of the above questions life insurance offers flexible, cost effective and tax efficient solutions to shareholders, corporations and partners alike.