Business Planning / Continuity
Business Continuity Made Simple: Key Person Insurance & Buy-Sell Agreements | CGJ Financial
Business Continuity Made Simple: Key Person Insurance & Buy-Sell Agreements | CGJ Financial
Protect revenue and ownership with key person insurance and funded buy-sell agreements. Keep clients, calm lenders, and transfer equity cleanly.
Protect revenue and ownership with key person insurance and funded buy-sell agreements. Keep clients, calm lenders, and transfer equity cleanly.
Business Continuity, Simplified: Key Person Insurance & Buy-Sell Agreements That Actually Work
What happens if the person who drives your business isn’t there tomorrow?
It could be you. A co-founder. Or the rainmaker who brings in most of the revenue.
Death. Disability. An unexpected exit.
Without a plan, clients leave. Lenders panic. Partners scramble.
With a plan, the business stays steady — and keeps moving.
The Two Tools That Keep Your Business Standing
1. Key Person Insurance (Life & Disability)
What it is: A policy the company owns on a critical individual. If that person dies or becomes disabled, the payout goes directly to the business.
Why it matters:
Provides cash to stabilize operations, recruit talent, and replace lost revenue.
Signals to banks and investors that you’re prepared.
Protects valuation during turbulent times.
Who’s “key”? Owners, lead producers, technical experts — anyone whose absence would significantly impact revenue or operations.
How much coverage? We help you quantify:
Revenue contribution.
Replacement and recruiting costs.
Loan covenants and lender expectations.
Time-to-replace and ramp-up.
The result? Coverage that actually fits your risk.
2. Buy-Sell Agreements (Funded the Smart Way)
What it is: A legal agreement defining who buys, who sells, at what price, and how it’s funded when an owner exits (death, disability, retirement, divorce, dispute).
Why funding matters: A perfectly written agreement fails without cash. Funding with life and disability buy-out coverage turns promises into money on day one.
Common structures:
Cross-Purchase: Owners insure each other. Surviving owners buy the departing owner’s shares.
Entity Purchase (Stock Redemption): The company buys the shares.
Hybrid: Mix of both for tax or equity balance.
We coordinate with your attorney and CPA to keep your valuation method and funding design in sync.
What a Clean Continuity Plan Looks Like
A trigger occurs (death, disability, or qualifying exit).
Insurance proceeds arrive (key person or buy-sell coverage).
Operations stabilize (client retention, interim hires, debt flexibility).
Ownership transfers cleanly — no fire sales, no family disputes.
That’s business continuity — simple, respectful, and financially sound.
How CGJ Financial Helps
Assess exposure across key people, revenue lines, and lender requirements.
Right-size coverage using 15+ A-rated carriers.
Align legal documents and funding with your attorney/CPA.
Review annually as valuations, roles, and goals change.
Learn more here: Business Continuity Solutions.
Quick Owner’s Checklist
Identify your key people (revenue + operations).
Confirm a written buy-sell exists — and is current.
Verify funding matches valuation and triggers.
Check lender covenants and guarantees.
Schedule annual reviews for valuation, coverage, and beneficiaries.
Keep Your Business Strong — No Matter What
You’ve built something worth protecting. Don’t leave it to chance.
We’ll help you safeguard revenue, key people, and ownership — so your life’s work stands firm, no matter what.
Schedule Your Free Consultation and let’s design a continuity plan that keeps your business strong today — and for generations.
Business Continuity, Simplified: Key Person Insurance & Buy-Sell Agreements That Actually Work
What happens if the person who drives your business isn’t there tomorrow?
It could be you. A co-founder. Or the rainmaker who brings in most of the revenue.
Death. Disability. An unexpected exit.
Without a plan, clients leave. Lenders panic. Partners scramble.
With a plan, the business stays steady — and keeps moving.
The Two Tools That Keep Your Business Standing
1. Key Person Insurance (Life & Disability)
What it is: A policy the company owns on a critical individual. If that person dies or becomes disabled, the payout goes directly to the business.
Why it matters:
Provides cash to stabilize operations, recruit talent, and replace lost revenue.
Signals to banks and investors that you’re prepared.
Protects valuation during turbulent times.
Who’s “key”? Owners, lead producers, technical experts — anyone whose absence would significantly impact revenue or operations.
How much coverage? We help you quantify:
Revenue contribution.
Replacement and recruiting costs.
Loan covenants and lender expectations.
Time-to-replace and ramp-up.
The result? Coverage that actually fits your risk.
2. Buy-Sell Agreements (Funded the Smart Way)
What it is: A legal agreement defining who buys, who sells, at what price, and how it’s funded when an owner exits (death, disability, retirement, divorce, dispute).
Why funding matters: A perfectly written agreement fails without cash. Funding with life and disability buy-out coverage turns promises into money on day one.
Common structures:
Cross-Purchase: Owners insure each other. Surviving owners buy the departing owner’s shares.
Entity Purchase (Stock Redemption): The company buys the shares.
Hybrid: Mix of both for tax or equity balance.
We coordinate with your attorney and CPA to keep your valuation method and funding design in sync.
What a Clean Continuity Plan Looks Like
A trigger occurs (death, disability, or qualifying exit).
Insurance proceeds arrive (key person or buy-sell coverage).
Operations stabilize (client retention, interim hires, debt flexibility).
Ownership transfers cleanly — no fire sales, no family disputes.
That’s business continuity — simple, respectful, and financially sound.
How CGJ Financial Helps
Assess exposure across key people, revenue lines, and lender requirements.
Right-size coverage using 15+ A-rated carriers.
Align legal documents and funding with your attorney/CPA.
Review annually as valuations, roles, and goals change.
Learn more here: Business Continuity Solutions.
Quick Owner’s Checklist
Identify your key people (revenue + operations).
Confirm a written buy-sell exists — and is current.
Verify funding matches valuation and triggers.
Check lender covenants and guarantees.
Schedule annual reviews for valuation, coverage, and beneficiaries.
Keep Your Business Strong — No Matter What
You’ve built something worth protecting. Don’t leave it to chance.
We’ll help you safeguard revenue, key people, and ownership — so your life’s work stands firm, no matter what.
Schedule Your Free Consultation and let’s design a continuity plan that keeps your business strong today — and for generations.
