Estimate how much buy sell insurance your business may need to fund a shareholder buyout. This calculator considers business value, ownership percentages and liabilities to guide appropriate life, TPD and trauma cover.
'Calculator results are estimates only and not quotes. Actual quotes will be provided by licensed brokers after you submit an enquiry.'
1. Valuation
2. Shareholders
3. Results
4. How it works
Step 1 – Business valuation inputs
This is your EBIT, EBITDA or revenue depending on the selected method.
Step 2 – Shareholders / owners
Add each owner and their shareholding. You can also include debt / guarantee exposure and extra buyout funding needs if relevant.
Step 3 – Recommended cover
$0
Business value used
$0
Total Life cover
$0
Total TPD cover
$0
Total Trauma cover
Individual shareholder recommendations
This is a general planning aid only. Buy-sell deed wording, valuation methodology, tax treatment, ownership structure and trigger events should be reviewed before implementation.
Step 4 – How this calculator works
Life cover
Usually sized to fund the owner’s equity value and any related debt or guarantee exposure so control can transfer smoothly.
TPD cover
Often mirrors the buyout value where a permanently disabled owner can no longer continue in the business but still needs to be bought out.
Trauma cover
Usually smaller than Life/TPD and aimed at short-term liquidity, stabilisation or interim succession planning after a serious illness event.
Valuation matters: an agreed value under a buy-sell deed may differ from a quick multiple-based estimate, so the legal agreement and the insurance funding should be reviewed together.
How to use our Buy Sell Insurance Calculator
How to use our Buy Sell Insurance Calculator
Our Buy Sell Insurance Calculator is a business succession planning tool that helps you estimate how much Life, Total and Permanent Disability (TPD) and Trauma cover may be needed to fund a buyout if a business owner dies, becomes permanently disabled, or suffers a serious illness. It is important because it helps quantify each owner’s share of the business so remaining owners can retain control and support a smoother ownership transition.
This calculator provides general information only and does not take into account your objectives, financial situation or needs. Results are indicative, not a quote or recommendation. You should consider the relevant Product Disclosure Statement and obtain advice from an appropriately licensed professional before acting.
1. Business valuation inputs: Start by entering the company or business name (optional) and selecting your industry. Then choose a valuation method: enter an agreed value, or calculate from EBIT, EBITDA or revenue using a multiple.
2. Value fields: If using an agreed value, enter the agreed or estimated business value. If using a multiple method, enter the base metric amount (your EBIT, EBITDA or revenue) and the valuation multiple so the calculator can derive a business value.
3. Adjustments: Add business debt or liabilities if debt support or guarantee relief is part of the funding need. Set a transaction, legal, tax and valuation buffer percentage to allow for real-world costs.
4. Trauma guide and rounding: Choose a Trauma cover guide percentage (often lower than Life and TPD) and select how to round recommendations (for example nearest $10,000 or $50,000) to produce practical target sums insured.
5. Shareholders or owners: Click “Add shareholder” and enter each owner’s details and shareholding. For best results, ensure ownership percentages are accurate and align with your legal structure and buy-sell deed (for example company, trust or partnership arrangements).
6. Calculate and interpret results: Click “Calculate cover” to view the business value used plus total Life cover, total TPD cover and total Trauma cover. Use the JSON summary for a clean handoff to your adviser or broker for review and implementation discussions.
Finally, treat outputs as a starting point only. Buy-sell deed wording, valuation methodology, tax treatment, ownership structure and trigger events should be reviewed before you implement cover.
Australia's long-running financial advice reform debate is again highly relevant for business owners, particularly those who have delayed reviewing life insurance because the process feels complex, expensive or overly document-heavy. The latest industry focus is on whether simpler advice pathways can help more Australians receive practical guidance about life cover, including the insurance arrangements that sit behind business succession, debt protection and key person risk. - read more
Recent industry attention on APRA’s operational risk standard, CPS 230, is a timely reminder that life insurance is not only about premiums, policy definitions and benefit amounts. For business owners, it is also about whether the insurer has the systems, service providers and continuity planning needed to perform when a claim becomes urgent. - read more
APRA’s latest life insurance performance data gives business owners another reason to treat protection planning as an active management issue, not a set-and-forget purchase. While the sector continues to show signs of financial resilience, the broader picture remains one of higher premium income, substantial claims activity and ongoing pressure across disability-related cover. - read more
The Council of Australian Life Insurers has renewed its push for Australians to receive simpler guidance about life insurance held through superannuation, arguing that many people do not fully understand the cover already attached to their super accounts. For business owners, this is more than a personal finance issue. It is a reminder that default or group cover may sit quietly in the background while the real financial risks of ownership, debt, succession and key-person dependency remain unchecked. - read more
Business life insurance is an essential part of the strategic planning for businesses. Essentially, it is a policy that provides a financial safety net for businesses upon the death or disability of key business personnel. This type of insurance helps ensure the continuity and stability of the business by funding buy-sell agreements, compensating for the loss of a key person, or providing funds to pay off debts. - read more
Buy-sell agreements are crucial legal contracts that outline how a partner’s share of a business may be reassigned if that partner dies or otherwise leaves the business. These agreements are often part of a company's succession planning strategy, aiming to provide a clear path forward in the case of unforeseen events. - read more
Key person risk is a critical consideration for small and medium-sized enterprises (SMEs). It refers to the financial risk a company faces due to the potential loss of an employee who plays a pivotal role in its success. This key individual could be a founder, an executive, or anyone whose departure could significantly impact the company's operations and strategic direction. - read more
Business debt protection insurance is a specialised type of insurance designed to shield businesses from the financial fallout that can occur if they find themselves unable to meet their debt obligations. By providing coverage against such scenarios, this insurance acts as a safety net for businesses, ensuring that unexpected events do not lead to crippling financial losses. - read more
Knowledgebase
Depreciation: The reduction in the value of an asset over time, used in insurance to calculate the actual cash value of property.
