You’ve spent a lot of time and energy building a successful business your family and employees can rely on, but at some point you’re going to transition out of your business. Planning for that transition can mean the difference between success and failure.

Be sure to choose a strategy and product that are suitable for the long-term goals of both the business and its employees. Weigh objectives, time horizon and risk tolerance, as well as any associated costs, before investing. Market volatility can lead to the need for additional premium in the policy. Variable life insurance has fees and charges that include costs of insurance, underlying fund expenses and administration fees. Investing involves risk, including possible loss of principal.

A business succession plan is simply an agreement between the seller and a buyer of the business that defines:

  • Triggering events that will initiate a transfer of the business
  • A purchase price that reflects the true value of the business
  • How the seller should be paid for his or her interest in the business
  • Of course, it’s important for an attorney to draft the agreement, but our team of specialists can help by providing sample agreements and consultative support.

Identify your business succession goals:

Every business owner is different. Some will use their business as their own retirement fund or as
a source of income for their surviving spouse, while others may leave it to their children as a gift.

As you think through this for yourself, some good questions to answer are:

  • What are your personal plans for the future?
  • What’s your plan for the future of the business?
  • How would you like to transition out of the business?
  • Who will own the business when you’re gone?
  • What needs to be done to get the successor ready?
  • How will the successor acquire your business interest?
  • What do you think your business is worth?
  • How much do you need for retirement?
  • How much would your family need if you were gone?

Understand how a business succession plan will help you: 

A business succession plan helps to protect you and your family from having to find a buyer and negotiate a price and terms when you may lack leverage because of a disability, an impending retirement or an untimely death. It will help:

  • Solidify a market for your business
  • Establish funds for the purchase of the business
  • Create certainty about the price, terms and financing
  • Identify triggering events for succession
  • Establish your retirement income
  • Provide a sense of security for your surviving family members
  • Facilitate a smooth and controlled transition
  • Reduce the potential for future litigation

Three simple and effective types of plans:

-1 | Entity purchase arrangement

-2 | Cross purchase arrangement

-3 | One-way purchase arrangement


We make business succession planning easier. We’ve designed life insurance products specifically to meet your needs as a business owner. For example, some of the many options could be:

    • Fixed and variable universal life, so you have options whether you’re conservative
      or more aggressive
    • Policy pricing that gives you the opportunity to accumulate cash value more quickly
    • Underwriting flexibility, with both guaranteed-issue or simplified-issue underwriting available
      (certain qualifications must be met)

Whatever your business and whatever the size, our Commercial and Financial team can help YOU create a strategy to PLAN. ACHIEVE. and PROTECT your company, your goals, and your income. For a FREE consultation, contact The Choice Insurance Agency Team today at 757-416-5100 . We’re Happy To help!

All The Best,


The Choice Insurance Agency Team


The Choice Insurance Agency’s mission is to help you get from where you are to where you want to be financially by planning, achieving your plan and protecting your plan from unexpected events.  In the process, our goal is to deliver insurance services in a manner that exceeds your expectations.  See what The Choice Insurance Agency can do for you today. Give us a call at 757-416-5100 to speak with one of the licensed, professional members of our team or request a contact here. The Choice Insurance Agency. We’re on YOUR side. 757-416-5100 .

*Content and information provided in this post was created by Nationwide Insurance and was approved for public use.