The corporation can generally keep the policy, use it for a different purpose, transfer it, for example to the person it covers, or cancel it. A transfer can have tax consequences for the corporation and the new owner, so get tax advice before making one.
What happens to a business-owned life insurance policy if a key person leaves the company?
Reviewed by Garrett Agencies Ltd., October 2026. How we write
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More about business-owned life insurance
Life insurance held by the corporation, for funding obligations and planning ahead.
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