Document background
The Buy Sell Life Insurance Agreement is a specialized contract designed for businesses operating in India where multiple owners wish to establish a clear succession plan in the event of an owner's death. This agreement is particularly crucial for private companies, partnerships, and family businesses where business continuity is essential. The document combines insurance and corporate law elements, structured under Indian jurisdiction, specifically complying with the Insurance Act 1938, IRDAI regulations, and the Companies Act 2013. It details the mechanism by which surviving business owners can purchase a deceased owner's interest using life insurance proceeds, including specific provisions for policy maintenance, premium payments, business valuation methods, and transfer procedures. The agreement becomes especially relevant in scenarios where businesses need to ensure smooth ownership transition while maintaining operational stability and preventing potential disputes among surviving owners and deceased owner's heirs.
