Ownership Protection

If you are a business partner or a shareholding company director, your share in the business is likely to be one of your most valuable assets.

Ownership protection will provide money so that in the event of death, terminal or critical illness, the remaining shareholders or partners have the cash to purchase the interest and stay in control.

This will stabilise the business at a potential time of uncertainty and everyone involved; employees, creditors, suppliers, customers, executors and owners will have confidence in the company.

Different types of cover:

  • Shareholder Protection
  • Company Share Purchase Protection
  • Partnership Protection
  • Limited Liability Protection

The loss of a partner or shareholding director under a limited company can have a major impact on the success of a business in terms of ensuring continued control for the remaining partners/owners.

  • A shareholder's rights normally pass to the deceased's dependents and they will suddenly have a right to say how the company is run. They may not want this nor may the company's remaining shareholders.
  • If the shareholder owned 75% or more of the business, the recipients of the shareholders' estate could force the winding up or sale of the business.
  • The dependents of the shareholder may prefer to receive a cash lump sum on death but the shareholders may not have the liquid monies at their disposal to effect this. Shares possibly could therefore be sold on, reducing control of the business.
  • Each controlling shareholder director takes on a policy in their own name for an amount that reflects the value of their individual shareholding.
  • An agreement can be drafted setting out how the shares in the company should be valued and allowing the surviving shareholders the right to buy the shares and the estate, or outgoing shareholder, the right to sell.
  • A plan is set up that provides the funds to allow the shares to be purchased.

Did you know?

Over 50%

of businesses have left no instructions in a will or any special arrangements regarding shares.

Malcolm Robertson - Business Specialist

Specialist advice, impartial, free.

Speak with a business protection specialist who can answer any questions you have, and find the most suitable cover for your business, employees and your family.

Call 0800 804 6813

Mon-Thurs: 8am-8pm,
Friday: 8am-7pm
Saturday: 9am-2.30pm

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