Buy Sell Life Insurance Agreement Template for United Arab Emirates

The Buy-Sell Life Insurance Agreement is a sophisticated legal instrument designed for businesses operating in the United Arab Emirates seeking to establish a clear succession and transition plan. This document becomes essential when business owners want to ensure their company's continuity and protect both their families and business partners in case of death, disability, or retirement. It combines elements of insurance law, corporate law, and succession planning, structured in compliance with UAE Federal Law No. 6 of 2007 and related Insurance Authority regulations. The agreement details how life insurance policies will fund the purchase of a departing owner's business interest, ensuring liquidity for such transactions. This document is particularly crucial in the UAE context, where family businesses and privately held companies form a significant part of the economy, and where specific regulatory and optional Sharia compliance considerations must be addressed.

1. Parties: Identification of all parties including business owners, their company, and the insurance provider

2. Background: Context of the agreement, including business ownership details and purpose of the buy-sell arrangement

3. Definitions: Key terms used throughout the agreement, including insurance-specific terminology and UAE regulatory terms

4. Purchase Obligation: Mandatory obligation to purchase deceased/departing owner's interest upon trigger events

5. Insurance Policy Requirements: Specifications for required life insurance policies, including coverage amounts and maintenance requirements

6. Premium Payments: Responsibilities and arrangements for payment of insurance premiums

7. Valuation Method: Agreed method for determining business value and corresponding insurance coverage

8. Trigger Events: Events activating the buy-sell provisions (death, disability, retirement, etc.)

9. Payment Terms: Structure and timing of payments from insurance proceeds to purchase business interest

10. Rights and Obligations: Ongoing responsibilities of all parties regarding policy maintenance and reporting

11. Transfer Restrictions: Limitations on transfer of business interests and insurance policies

12. Regulatory Compliance: Compliance requirements with UAE insurance laws and regulations

13. Term and Termination: Duration of agreement and conditions for termination

14. Governing Law and Jurisdiction: Specification of UAE law application and jurisdiction for disputes