How many total life insurance policies are needed in a Cross-Purchase Buy Sell Agreement among three law partners?

In a Cross-Purchase Buy-Sell Agreement, each partner agrees to purchase a life insurance policy on the lives of the other partners. This ensures that in the event of a partner’s death, the remaining partners can buy the deceased partner's share of the business using the funds from the policy.

With three law partners in this scenario, each partner will need a policy on the other two partners. Therefore:

• Partner A will need policies on Partner B and Partner C (2 policies)

• Partner B will need policies on Partner A and Partner C (2 policies)

• Partner C will need policies on Partner A and Partner B (2 policies)

When added together, the total comes to 6 life insurance policies (2 policies per partner multiplied by 3 partners). This ensures that all partners are protected and have the financial means to buy the deceased partner's share, maintaining the continuity of the business. The answer reflects a comprehensive understanding of how Cross-Purchase Buy-Sell Agreements operate among multiple partners in a business setting.