Building a successful business requires constant attention and momentum.

But as businesses grow, so do the stakes, and over time, owners often realize they’ve spent years focused on growth without spending much time preparing for what’s next.

The right questions and strategies often uncover opportunities to create more flexibility, more stability, and more control over the future.

That’s why business owners should be taking a broader look at their long-term goals. Here are five questions to ask and how the strategic use of life insurance can help.

1. What’s my plan for eventually exiting this business?

A surprising number of business owners don’t have a clear answer to that question.

Matt Erpelding, CLU, ChFC Midland National Advanced Markets Case Design Consultant

“I’ll sell eventually.”

“Maybe the kids will take over.”

“I’ll slow down in a few years.”

For many owners, the business is their largest asset. The challenge is that it’s also one of the least liquid assets they own. Without planning, owners can find themselves reacting to circumstances instead of making intentional decisions.

Health issues, burnout, market shifts, or unexpected opportunities can suddenly force conversations that should have started much earlier.

The earlier owners start thinking through transition options, the more flexibility they tend to have. These conversations also tend to uncover another important issue: liquidity.

If an owner’s timeline changes unexpectedly, where does financial flexibility come from? In some cases, life insurance becomes part of that planning process by helping create liquidity during an unexpected transition.

The goal isn’t simply to leave the business someday. It’s to preserve the value that’s been built and create options for the future.

2. If something happened to me or my business partner, what would happen to the business?

This is one of the most important business planning questions, and one of the easiest to avoid.

Many companies have buy-sell agreements in place, but a lot of those agreements haven’t been updated in years, and many aren’t properly funded.

A buy-sell agreement may explain what should happen if an owner dies or becomes disabled, but the agreement itself doesn’t create cash.

If an ownership transition suddenly becomes necessary, where does the money come from? Can the remaining owners realistically buy out the departing owner’s interest? What happens to the family of the owner who is no longer involved?

These situations can create financial and emotional strain very quickly, which is why life insurance is commonly used to fund buy-sell agreements. Properly structured coverage can provide immediate liquidity so surviving owners can maintain control of the business while ensuring the departing owner’s family receives fair value.

A written agreement matters. But a funded agreement is what allows the plan to actually work when it’s needed.

And as businesses grow, these conversations become even more important. Ownership structures evolve, valuations change, and outdated agreements can create unintended consequences if they aren’t reviewed regularly.

3. Who are the employees this business can’t afford to lose?

Most businesses have key people whose impact goes far beyond their job title.

They may manage critical client relationships, drive a large percentage of revenue, or hold operational knowledge that would be difficult to replace.

And yet many business owners haven’t fully evaluated what losing one of those employees would mean financially or operationally.

That’s where key person planning becomes important.

If a critical employee were suddenly gone, how would the business absorb the disruption? How long would it take to recover lost revenue or recruit a replacement?

Many companies use key person life insurance as part of their overall business protection strategy. The proceeds can help stabilize operations, offset financial losses, or support transition costs during a difficult period.

Key person planning is also about retention.

Businesses that proactively invest in key employees often build stronger long-term stability. Executive benefit strategies, long-term incentives, and retention-focused planning can help align important employees with the future success of the business.

Keep this in mind. Protecting key people and retaining them are often part of the same conversation.

4. How much of my personal financial future depends on this business?

For many owners, the honest answer is: almost all of it.

Business owners often reinvest heavily into growth opportunities and prioritize the company ahead of personal financial planning.

When most personal wealth is tied to one business, financial security becomes heavily dependent on the continued success of that company.

Eventually, many owners begin asking a different question:
How do I make sure the business supports my long-term personal goals instead of becoming my only financial plan?

Some owners focus on building assets outside the business to provide diversification. Others look at tax-efficient accumulation strategies or ways to create additional liquidity and long-term financial flexibility.

Life insurance can sometimes play a role in those conversations as well. Depending on the structure and objectives, it may help support wealth accumulation, estate planning, or broader risk management goals.

The point isn’t to stop investing in the business — it’s to make sure the business isn’t the only thing supporting the future.

5. Will my legacy create clarity or conflict?

For business owners, estate planning can quickly become more complicated than expected, especially when some family members are involved in the business and others are not.

Questions around fairness, ownership, taxes, and inheritance can create tension if they aren’t addressed ahead of time.

For example:

• Should ownership pass equally to all children?
• What happens if only one child actively runs the company?
• Will assets need to be sold to create liquidity?

These situations are common, but they require thoughtful planning.

Life insurance is often used as an equalization tool in estate planning. One heir may inherit ownership in the business while another receives insurance proceeds or other assets of comparable value.

That approach can help preserve fairness while allowing the business itself to remain intact.

Liquidity also matters when taxes and estate costs are involved. Without proper planning, families can sometimes be forced into rushed decisions at exactly the wrong time.

The goal of legacy planning isn’t just to transfer wealth. It’s to transfer it in a way that preserves relationships, reduces friction, and supports the long-term future of both the family and the business.

What to do next

Most business owners avoid these questions because they’re busy building the business.

The good news is that these conversations often uncover opportunities to strengthen the business, create flexibility, protect key people, and align business success with long-term personal goals.

And in many cases, tools like life insurance aren’t standalone solutions. They’re part of making broader strategies work in practice.

Keep in mind the most successful business owners usually aren’t the ones with every answer already figured out – they’re the ones willing to ask the right questions early enough to do act upon them.

Learn more about business owner solutions from Midland National.

DISCLOSURES

While the primary use of life insurance is death benefit protection, your clients may also have other needs that can be met through life insurance. The sales concepts and accompanying marketing materials may help you broaden your sales potential. As independent contractors, it is up to you to choose which of these concepts may work for your particular sales strategy and clients, and which do not. Please note that Midland National does not require you to use any of these sales concepts; they are resources that can be used at your discretion for your own individualized sales presentations.

Neither Midland National nor its agents give tax advice. Please advise your customers to consult with and rely on a qualified legal or tax advisor before entering into or paying additional premiums with respect to such arrangements.

Sammons Financial® is the marketing name for Sammons® Financial Group, Inc.’s member companies, including Midland National® Life Insurance Company. Annuities and life insurance are issued by, and product guarantees are solely the responsibility of, Midland National Life Insurance Company.

1864MM-8 FOR AGENT USE ONLY. NOT TO BE USED FOR CONSUMER SOLICITATION PURPOSES. 6-26