Author: Wise Invest

Background

Last year, Amir and Ebi reached out to WiseInvest™ to discuss their rapidly expanding business. Initially, their concerns revolved around tax savings and investing corporate surplus in the most tax-efficient way. However, during the initial meeting, our advisor noticed a significant gap in their planning: they had no Buy/Sell Agreement in place.

Identifying the Need

While reviewing their financial and operational structures, our advisor asked them about their strategy if one partner were to exit the business suddenly—due to disability, death, or another unforeseen event. Amir and Ebi were unfamiliar with the concept and importance of a Buy/Sell Agreement. We explained that without a solid plan, the business (valued in the millions) could be thrown into chaos, leaving the remaining partner and the family of the departing partner in a precarious situation.

The Recommendation

After several detailed sessions, our advisor recommended a framework for the Buy/Sell Agreement that would cover different scenarios, including death and disability. By the end of the month, Amir and Ebi formalized their agreement, and a month later, they purchased insurance to fund it. This policy was designed to cover the cost of buying out a partner’s share based on a method that accounted for the company’s fast-growing value.

Unforeseen Tragedy

Unfortunately, one year after finalizing the agreement, Ebi was diagnosed with liver cancer. He passed away two months later, leaving his family grieving and uncertain about the future. However, because the Buy/Sell Agreement and the insurance funding were already in place:

• Fair Valuation
  Ebi’s share was valued at $2.8 million in accordance with the agreed-upon valuation method.
• Insurance Payout
  A $3.5 million insurance policy covered the cost of purchasing Ebi’s shares and provided additional funds to the company. This extra cash helped cope with the sudden financial and operational burdens arising from Ebi’s absence.
• Smooth Transition
  Amir was able to assume full ownership without resorting to loans or dipping into company cash flow. Ebi’s family received timely compensation, honoring Ebi’s legacy and reducing uncertainty.

Outcome

By proactively establishing a Buy/Sell Agreement with adequate partnership insurance, this fast-growing business protected itself from disruption. Ebi’s family was financially secure, and Amir continued operations without risking the business’s stability. Their story is a stark reminder that preparing for worst-case scenarios is crucial to safeguarding your company and loved ones—even while you focus on growth, tax savings, and smart investment strategies.

*Note: For privacy reasons, the names and nature of our clients’ businesses have been changed.

Background

One of our clients—a mid-sized marketing agency with around 30 employees—prided itself on a tight-knit team culture. They had several top performers whose creativity and leadership drove key campaigns, and losing any of them could have a real impact on their bottom line.

The Problem

Late last year, one of their key project managers faced depression and was unable to work for four months. Her monthly salary was approximately $7,000, and she worried about lost income during her recovery. The agency feared that without adequate support, she might leave or start exploring new career options once she recovered—hurting the team’s morale and productivity.

The Solution

Before this incident, the agency partnered with WiseInvest™ to incorporate income protection insurance—often referred to as wage loss replacement—into their employee retention strategies. This coverage provided up to 70% of the project manager’s salary (about $4,900 per month) while she was out, relieving financial stress and reinforcing that the company genuinely cared about her well-being.

• Coverage Tailored to Needs
  WiseInvest™ helped the agency select a policy that matched their employees’ salary levels and typical living expenses.
• Support During Recovery
  While the project manager focused on her mental health, the insurance paid a significant portion of her wages, keeping her financially secure.
• Strengthened Retention
  This gesture of support increased loyalty—once she returned, she remained fully committed to the agency, driving its biggest accounts and mentoring junior team members.

The Results

By providing income protection insurance, the agency not only kept a high-value employee but also boosted overall team morale. Colleagues saw how management prioritized employee welfare, which helped solidify a culture of trust, loyalty, and long-term retention.

*Note: For privacy reasons, the names and nature of our clients’ businesses have been changed.

Background

One of our clients—a growing software development firm with 3 employees—relied heavily on its co-founder and lead developer. Her specialized knowledge and client relationships were critical to the company’s revenue stream.

The Problem

Earlier this year, the co-founder was involved in an accident that left her unable to work for several months. With a monthly overhead of $40,000—including rent, utilities, and salaries—the firm faced serious financial pressure without its key revenue driver.

The Solution

Fortunately, a few months prior, the firm had secured disability overhead expense insurance through WiseInvest™ (often referred to as key employee insurance or key person disability insurance). Here’s how it helped:

• Comprehensive Assessment
  We evaluated the client’s cash flow, identified core expenses, and gauged the impact of losing a key contributor.
• Tailored Coverage
  Based on our analysis, we recommended a policy that covered critical overhead costs of $40,000 per month if a key person became disabled.
• Ongoing Support
  Throughout the co-founder’s recovery, we coordinated with the insurer to ensure timely benefit payouts and advised the firm on financial adjustments to sustain operations.

The Results

Thanks to the coverage, the software firm maintained its existing team, kept crucial projects on track, and avoided accumulating massive debt. When their key developer recovered and returned, the company was able to jump back into full productivity without having lost clients or momentum. This experience reinforced the importance of protecting not just the business, but the people who make it successful.

*Note: For privacy reasons, the names and nature of our clients’ businesses have been changed.