Shareholder protection is an insurance policy put in place to protect a companies shareholders. This policy will pay out a lump sum upon a shareholders death to allow all the remaining shareholders to purchase the remaining shares and avoid any none suitable persons from inheriting or buying the shares.
Keyman insurance (also known as Keyperson Insurance) is an insurance policy which a company takes out on any of its key employees or directors to whom they consider of great value to the business and will suffer financial losses should this person die or suffer from a critical illness which forces them out of work.
This insurance protects business partners against each others death or diagnosis of a critical illness. Should a partner die then this policy will pay out a lump sum which can be used to buy out that partners shares to avoid any unwanted new partners or it can be used to continue funding the business until a solution has been made.
The Importance of Business Insurance. Protecting your company from the unexpected is paramount should you want it to survive from an unavoidable situation such as the death of a shareholder, company director or an essential member of staff.
Imagine the possible consequences involved such as:
An unwanted or reckless family member inheriting the shares.
Losing all of your top sales managers contacts & clients.
Someone from outside of the company/business inheriting the shares and selling them to one of your main competitors.
Your star business negotiator dies or becomes critically ill.
An integral member of your it team dies such as your website development manager.
With a shareholder protection insurance policy, your company can continue to operate and prosper safely in the knowledge that should a shareholder or director die then there will be funds made available which will enable you or your business to purchase that persons shares.