Buy-Sell Funding Calculator

Methodology

1. Each owner's interest value = business value × that owner's ownership percentage
2. Funding need associated with that owner's interest = interest value − existing insurance dedicated to that interest, never below zero; illustrative range = ± 25%
3. Policies in a cross-purchase arrangement where each owner insures each other owner = n × (n − 1), for n owners
4. Policies in an entity-purchase arrangement where the business insures each owner = n

Assumptions

• The business value is an illustrative figure. Use a current professional valuation for planning.
• Ownership percentages must add up to 100 percent.
• The policy counts assume one policy per insured owner per buyer. A buy-sell agreement and its funding can be structured in other ways.

Limitations

• This simplified sum assumes the amounts entered are independent, available in full and measured consistently. It does not model taxes, policy terms, underwriting, valuation disputes, double counting or timing. Revenue is not profit. Verify inputs with your advisers.
• The agreement's own valuation method, payment terms and price adjustments are not modelled.
• Educational illustration only. Not a quote, actuarial calculation, tax or legal advice, or individualized financial or insurance recommendation.
• Structure, ownership and tax treatment should be confirmed with qualified tax, legal and insurance professionals.

Methodology version 1.2.0, 2026-10-13.