What is buy-sell agreement?
Definition
Educational information only. Last reviewed August 25, 2026.
How it works in Canada
The agreement establishes obligations; funding makes them executable. Life and disability insurance are common funding sources. Valuation methodology should be defined and reviewed periodically so it does not become stale.
Example
Two equal shareholders may agree that on the death of either, the survivor purchases the deceased's shares at a valuation formula funded by insurance proceeds.
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Written and reviewed by CanadaGFI.ca Editorial Team
Licensed insurance and financial professionals contributing to CanadaGFI.ca
Published and last reviewed August 25, 2026. Read our editorial policy and disclosures.
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