SHAREHOLDER & PARTNERSHIP PROTECTION
WHAT IS SHAREHOLDER & PARTNERSHIP PROTECTION?
Are you a company that has shareholder’s? What would happen if one of the shareholder or partner unexpectedly passed away? Without a shareholder agreement in place, there could be a lot of uncertainty. Family beneficiaries could argue with the other shareholder owners about the direction of the company.
A shareholder agreement avoids all these issues; and a shareholder protection policy provides pay outs so the equity of the deceased shareholder can be purchased by their company owners as per the shareholder agreement. This provides peace of mind for all the shareholders that they wouldn’t have to struggle to purchase shares and the business could return to normality very quickly. The insurance is designed to ensure that the aftermath of a shareholder’s death is a smooth and stress free as possible.
BENEFITS OF SHAREHOLDER & PARTNERSHIP PROTECTION
• A safe and stable business plan: All companies need a stable business plan; shareholder protection provides succession planning. Deceased shareholders are a guaranteed way to shake up operations and can seriously harm the business. By taking out shareholder protection insurance, shareholders enjoy the total peace of mind that should a fellow investor pass away, surviving shareholders will not have to worry about finding the money to purchase assets.
• Support for family: When taking out shareholder protection insurance, company stakeholders can rest easy that their families will receive financial compensation in the case of their death. The policies guarantee a fair buy-out price, as well as a quick, easy and stress free process.
• Illness and disability: Shareholder protection insurance can also be used to cover serious illnesses. Given that the right agreements and policies have been put in place, a sick shareholder is able to sell shares to continuing shareholders.
HOW MUCH DOES IT COST?
Like Life Insurance, it will depend on the person who is insured, how healthy they are, their age and their lifestyle. At Manley Financial we can help calculate how much cover you may need, how to split the premiums between owners and we can identify the most appropriate shareholder protection policy and make sure everything is set up for you.