Fund your business continuity — not your next loan.
What happens to your business if a partner dies or becomes disabled?
Without the right funding in place, surviving partners may be forced to borrow, sell assets, or take on investors just to keep the business afloat.
Buy-sell insurance provides the capital your business needs to stay stable during ownership changes. It funds the buyout portion of a buy-sell agreement when a partner dies or becomes permanently disabled — keeping your company operational, your ownership intact, and your partner’s family treated fairly.
Why Buy-Sell Insurance Matters
A buy-sell agreement defines what happens when an owner exits.
Buy-sell insurance funds it.
At Horizon Insurance Services, we help Ohio business owners protect against financial disruption after a partner’s death or disability by ensuring their buy-sell agreements are properly funded with life and disability insurance.
Benefits of buy-sell insurance include:
- Immediate liquidity for ownership buyouts
- No need to borrow or liquidate assets
- Fair value for the departing owner’s share
- Protection for heirs and family members
- Continuity for employees, customers, and vendors
How Buy-Sell Insurance Works
Buy-sell insurance is a life or disability policy taken out on each partner or shareholder.
When one owner dies or becomes permanently disabled:
- The policy pays out to the surviving owners or the business
- Those proceeds fund the buyout of the deceased or disabled partner’s ownership share
- Ownership remains with the active partners, ensuring operational continuity
Note: Retirement or voluntary exits do not trigger an insurance payout. Those events must be funded through other mechanisms such as installment payments or retained earnings.
Policy Types and Funding Options
1. Term Life Insurance
Affordable coverage ideal for partnerships or corporations with defined time horizons.
2. Permanent Life Insurance
Provides lifetime coverage and builds cash value that can be leveraged later for business needs.
3. Disability Buyout Insurance
Pays a lump sum or installment benefit if a partner becomes permanently disabled and unable to return to work.
Our team helps determine the right mix of coverage based on ownership structure, tax considerations, and long-term succession goals.
Who Needs Buy-Sell Insurance?
This coverage is essential for:
- Partnerships and multi-member LLCs
- Closely held corporations
- Family businesses with multiple active owners
- Professional firms (medical, dental, accounting, legal)
- Businesses that couldn’t easily absorb the loss of an owner’s capital or leadership
If your business depends on one or two key partners, you need a funding plan for the “what if.”
Why Work With Horizon Insurance Services
We specialize in funding strategies for ownership continuity — not legal drafting. Our role is to ensure your buy-sell agreement is financially executable the day it’s needed.
We collaborate with your attorney and CPA when necessary to align coverage amounts, policy ownership, and tax treatment with your business structure.
Serving Columbus, Dublin, Worthington, Grandview, Short North, Clintonville, Hilliard, Upper Arlington, New Albany — plus Cleveland, Cincinnati, Dayton, Toledo, and beyond.
Buy-Sell Insurance FAQs
What’s the difference between a buy-sell agreement and buy-sell insurance?
The agreement defines how ownership changes hands; the insurance provides the cash to make it possible when a partner dies or becomes disabled.
Does buy-sell insurance cover retirement or voluntary exits?
No. Buy-sell insurance only funds events tied to death or disability. Retirement or voluntary exits require separate funding arrangements.
How much coverage do I need?
Coverage should reflect each partner’s ownership percentage and the current value of the business. We’ll help align policy amounts with your latest valuation.
Who owns and pays for the policy?
That depends on your structure. In a cross-purchase setup, each partner owns policies on the others. In an entity-purchase, the business owns the policies.
Can permanent life insurance be used for this purpose?
Yes. Permanent coverage can provide lifelong protection and build cash value that supports long-term planning or future buyouts.
How often should we review our coverage?
Every few years or whenever your business value, ownership structure, or partner roster changes.
Talk With a Local Advisor
Buy-sell insurance keeps your business stable when ownership changes overnight.
Let’s build a funding strategy that protects your company, your partners, and your families when it matters most.
