Business Life Insurance — Buy-Sell, Key Person & Succession Protection From Fish Creek Life
Business life insurance keeps a death, disability, or departure from turning into a forced sale, a lawsuit, or an operation that can’t recover. Fish Creek Life helps owners fund buy-sell agreements and key person coverage — and review plans against recent tax and case-law changes like Connelly v. United States.
Protecting the Business You Built
If you own a business with a partner, a family member, or key employees the operation can’t run without, business life insurance is infrastructure, not a perk. Compare business protection alongside farm & ranch succession planning and personal life insurance — contact Tom for a free review.
Your Business Is Worth Protecting.
Is It Actually Protected?
If you own a business with a partner, a family member, or key employees the operation can’t run without, life insurance is infrastructure — not a perk. It’s what keeps a death, disability, or departure from becoming a forced sale, a lawsuit, or a business that simply can’t recover.
Why This Matters Right Now
A Ruling That Broke Buy-Sell Agreements
A 2024 Supreme Court ruling (Connelly v. United States) changed how many buy-sell agreements are taxed. If yours was drafted before that ruling, it may no longer work the way you think it does.
Key Person Risk
The person (or people) whose absence would genuinely hurt revenue, financing, or client relationships needs coverage of their own — separate from any owner buyout.
Forced Sale Risk
Without real cash behind your agreement, a death, disability, or departure can force a sale, spark a lawsuit between heirs and surviving owners, or leave a business that can’t recover.
Outdated Plans
Tax law and case law both moved recently. A plan drafted five years ago may be running on assumptions that no longer hold.
Understanding Business Protection
Building a Plan Around Your Structure
Business protection isn’t one product — it’s a structure built around how your company is owned and who it depends on:
- Funded vs. Unfunded: A buy-sell agreement is just a contract until it’s backed by an actual insurance policy. An unfunded agreement is a promise; a funded one is cash on the day it’s needed.
- Cross-Purchase vs. Entity-Purchase: Two different structures for how a buyout is executed and taxed. The right one depends on your number of owners and your goals.
- Key Person Valuation: Coverage on a key owner or employee should reflect the actual revenue, financing, or client-relationship impact of losing them — not a round number.
The Business Protection Toolkit
Every business needs a different mix depending on ownership structure and who the operation depends on. We evaluate your specific situation to recommend the right combination.
Buy-Sell Agreements
Funded Ownership Transition
- Sets the buyout terms in advance
- Backed by an actual policy
- Prevents heirs from inheriting a business
- Cross-purchase or entity-purchase structure
The “Ownership Transition” Strategy
What it is: A contract that says what happens if you or a partner dies, is disabled, or leaves — backed by an actual policy, not just a promise.
Who it’s for: Any business with two or more owners who want a clean, pre-negotiated exit instead of a dispute.
Key Person Insurance
Revenue Protection
- Company owns the policy
- Covers the revenue-critical people
- Bridges the gap while you replace them
- Reassures lenders and investors
The “Revenue Protection” Strategy
What it is: Coverage on the person (or people) whose absence would genuinely hurt revenue, financing, or client relationships.
Who it’s for: Founders, top producers, and any employee a bank or investor would ask about by name.
Succession & Tax Review
Stay Current
- Checks funding against your agreement
- Flags post-Connelly tax exposure
- Reviews structure vs. current law
- Coordinates with your CPA/attorney
The “Stay Current” Strategy
What it is: A quick review of your existing plan against recent tax and case-law changes — including the 2024 Connelly v. United States ruling.
Who it’s for: Any owner whose buy-sell agreement or key person coverage was set up more than a few years ago.
Frequently Asked Questions
What is a buy-sell agreement and why does it need to be funded?
A buy-sell agreement is a contract that says what happens if an owner dies, becomes disabled, or leaves the business. On its own it’s just a promise; funding it with a life insurance policy means there’s actual cash available the day it’s needed, instead of forcing a sale or a loan.
How did the Connelly v. United States ruling affect buy-sell agreements?
The 2024 Supreme Court ruling changed how many buy-sell agreements are taxed, specifically around how company-owned life insurance affects a business’s estate tax valuation. Agreements drafted before the ruling may no longer work the way owners assume, which is why a review matters.
What is key person life insurance and who needs it?
Key person insurance is a policy the business owns on someone whose absence would genuinely hurt revenue, financing, or client relationships — often a founder, top producer, or specialist employee. It gives the business cash to bridge the gap while it recovers or replaces that person.
Related Reading
- Your Business Insurance Is Probably Broken — Here’s Why
- Buy-Sell Agreements
- Key Man Life Insurance
- The Buy-Sell Tax Trap
- What Happens When a Business Partner Dies?
- Cross-Purchase vs. Entity-Purchase
- Farm & Ranch Succession Planning
Browse all our Business Insurance articles →
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