|
Shareholder Protection Insurance Shareholder Protection insurance is primarily designed for businesses that are owned by multiple shareholders or partners.
A partner/shareholder may be unable to continue to contribute to the business due to death, illness or injury. In this event, it provides the necessary liquidity for the surviving shareholder to buy the deceased or disabled shareholder’s share. It is essential that this type of insurance is backed up by a formal shareholder agreement. We can advise you on this. |
Why you need Shareholder Protection Insurance Problems can arise for businesses when a shareholder dies or is unable to work and their shares are passed on to the beneficiaries of their estate (spouse/ children.)
Two parties need to be protected: the beneficiaries of the deceased estate and the surviving business shareholders. Shareholder Protection insurance gives you the opportunity to protect both of your interests. The surviving shareholder may find themselves in business with the deceased shareholder’s beneficiaries (e.g. spouse, children or trustees.) Often funds need to be raised to buy out the shares at the agreed price, which can be difficult and costly. Shareholder Protection insurance is the most cost efficient way of raising the funds. Funds will be made available for the surviving shareholder to acquire the shares of a deceased or disabled shareholder. Shareholder Protection insurance enables you to protect the capital value of your business. |
For advice or help, talk to an experienced adviser.
You may need a specific mix of business insurance to ensure you can stay in business in the face of unexpected life events. Our advisers will help you to establish the best balance between risk and the cover your business requires to continue to thrive. Arrange a consultation with one of our advisers. |
|