Business continuation insurance is insurance structured to protect against the financial effect of the death of disability of a partner and support business succession planning. Usually comprising life and disability insurance policies, the policies depend on the terms of ownership transfer, which may take the form of a buy-sell, cross purchase, or entity purchase plan.
Business continuation insurance is a risk management strategy that enables the rest of the company to move forward despite the loss of a key person. It helps reduce the effect of the stress resulting from the financial losses and sudden lack of leadership and implements a clear agreement to ensure business succession and prevent future power struggles, misunderstandings, or conflicts.
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