The one-page checklist for protecting your startup

Most founders know they need key man insurance and a buy-sell agreement. What they don't know is everything else that falls through the cracks — the credentials nobody else can access, the verbal agreements that aren't documented, the governance gaps that become crises when someone can't show up to work.

This checklist covers the full spectrum. Go through it with your cofounder. Check off what's done. Flag what's not. The gaps are your action items.

Insurance Protection

  • Key man life insurance on each cofounder — Coverage owned by the company, beneficiary is the company. Amount based on valuation, investor requirements, and key person dependency.
  • Key man disability insurance on each cofounder — Disability is 3x more likely than death for founders under 45. Don't skip this.
  • Coverage on critical non-founder employees — Any person whose departure would set the company back 6+ months. CTO, VP Engineering, lead sales, key technical architects.
  • Coverage amounts reviewed within the last 12 months — What was enough at seed stage isn't enough at Series A.
  • Certificates of insurance on file — Sent to investors as required by term sheet.
  • D&O insurance in place — Required for any startup with a board. Different from key man insurance.

Legal Agreements

  • Buy-sell agreement executed between all cofounders — Covers death, disability, voluntary departure, involuntary removal, and divorce.
  • Buy-sell agreement funded with insurance — An unfunded buy-sell agreement is a promise backed by money that doesn't exist.
  • Valuation methodology agreed upon — 409A, formula, or independent appraisal — decided before anyone has a reason to argue about value.
  • Vesting agreements include death/disability provisions — Default vesting terms often don't address death adequately.
  • Operating agreement or bylaws updated — Reflects current ownership, decision-making authority, and emergency governance provisions.
  • Non-compete and IP assignment agreements in place — For all cofounders and key employees.

Operational Continuity

  • No critical system accessible by only one person — Cloud accounts, deployment pipelines, production databases, financial accounts, vendor portals.
  • Shared password manager with emergency access — If the person who holds the master password dies, can someone else get in?
  • Architecture decisions documented — Not "everything documented" — but the critical decisions, the trade-offs, and the known limitations that would take months to rediscover.
  • Key customer relationships have secondary contacts — Every top-10 account should have at least two internal relationships.
  • Interim leadership identified for each critical function — If the CEO is gone tomorrow, who runs the company for 90 days? Do they know?
  • Board communication backup designated — Someone your lead investor knows by name and trusts, who can communicate on behalf of the company if the CEO can't.

Financial Protection

  • Bank account access for at least two authorized signers — If one signer dies, the other can still run payroll.
  • Personal guarantees documented and covered — Any business debt with a personal guarantee should be matched by key man insurance on the guarantor.
  • Emergency signing authority in place — Limited powers of attorney that activate if the primary authority is incapacitated.
  • Payroll can run without any single person — Test this: if your bookkeeper or CFO is gone Monday, does payroll still happen Friday?

Estate Planning Alignment

  • Each cofounder has a personal will — Without one, state intestacy law decides what happens to their shares. That means their spouse, parents, or siblings become your shareholders.
  • Personal estate plans align with the buy-sell agreement — If the buy-sell says the company buys back shares at death, the founder's will shouldn't direct those shares to a trust that refuses to sell.
  • Personal life insurance in addition to key man coverage — Key man pays the company. Personal life insurance pays the family. Both are needed.

Governance & Investor Compliance

  • All term sheet insurance requirements satisfied — Key man, D&O, and any other required coverage in place with certificates on file.
  • Board meeting minutes documenting protection decisions — Shows governance maturity. Investors notice.
  • Annual review scheduled — Coverage amounts, valuations, and succession designations reviewed at least once per year.

The quarterly check

Run through this checklist every quarter. It takes 30 minutes. The items that have changed — new hires, new funding, new debt, personal life changes — are your action items for the next quarter.

The founders who do this quarterly are the ones whose companies survive the unexpected. The founders who put it off are the ones who end up in the scenario articles on this site.

Coverage subject to underwriting approval. Insurance products vary by state. Consult your tax and legal advisors for situation-specific guidance.