Entity-Purchase Agreement
Definition
- A financial plan used by businesses with more than one owner where the company takes out a life insurance policy for each owner equalling the owner's stake in the business. If one of the owners dies, an entity-purchase agreement guarantees that the company will continue to run, while allowing the surviving owners to buy out the deceased owner's share of the business and evade any out-of-pocket expenses related to the deceased owner's passing.
Synonyms
partner insurance, business partner protection, equity purchase insurance, business protection
Related Terms and Acronyms
- Business Continuation Insurance — Definition,
- Insurance that provides coverage in the event that someone integral to the operation of a business dies or becomes disabled.
- Business Life Insurance — Definition,
- Life insurance that provides coverage in the event that a person key to the operation of a business dies.
- Insurable Interest — Definition,
- Something of sufficient worth and benefit that an individual or entity would have reason to insure against its lost.
- Life Insurance — Definition, Very Important,
- An arrangement where an insurer agrees to pay a benefit to one or more beneficiaries in the event of the policyholder's death.
➥ CanEquity offers life insurance. - Proprietor — Definition,
- The owner of a business or property.
- Single Interest Insurance — Definition,
- Insurance that covers a single party when more than one party has a stake in a property.
