Shareholder Protection Insurance

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Shareholder Protection Insurance Key man Insurance UK
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Shareholder Protection Insurance Key man Insurance UK

What is Shareholder Protection Insurance?

Shareholder Protection Insurance is a life insurance policy set up to
facilitate the buyback of shares from a deceased estate.

 

One of the most damaging events a business can fall victim to is the death of a major shareholder. Should a shareholder or owner die unexpectedly, the event can have a serious impact on the company, not to mention the shareholder’s family.

Shareholder Protection Insurance allows the buy back of shares from either the deceased or ill shareholder. This allows the company and surviving shareholders to retain ownership and control of the company. It also rewards the wife or husband with the monetary value of the shares they have inherited.

The process of buying back shares involves purchasing the shared back from the estate of the deceased (or critically ill) shareholder. A Shareholder Protection policy is designed to facilitate this buyback. In the event of death, terminal illness or critical illness, a lump sum of money is paid to the remaining shareholders. This allows them to buy back shares from the deceased shareholder’s wife or husband.

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How Does Shareholder Protection Insurance Work?

Shareholder Protection Insurance Key man Insurance UK

There are three main ways to set up Shareholder Protection Insurance. 

A shareholder protection agreement must be put in place in order for things to run smoothly. This is sometimes called a double option agreement or a cross option agreement.  For more information on how these work please check out our  blog on cross options agreements.

Calculating The Amount of Cover Needed

Calculating the amount of shareholder insurance required typically involves a careful assessment of the value of the business, the ownership structure, and the financial needs of the business partners in the event of a claim. Here are some general steps to help you estimate the amount of shareholder protection cover needed:
Professional advice from insurance brokers or financial advisors with expertise in business succession and planning is highly recommended to ensure that the appropriate amount of cover is obtained. This is where we can help!

What Is The Cost of Protecting Shareholders?

The cost of a shareholder protection insurance policy will depend on each individual life assured. Quotes will be based on the age, sum assured, smoker status and term of the policy. Actual terms offered will also depend on the health of the individual.
Why not give us a call or fill in the above quote form to get a quote? It takes no more than 5 minutes.

Shareholder Protection Tax Treatment

The tax treatment of a Shareholder Protection policy can vary depending on various factors, such as the ownership structure of the business, the type of policy, and the specific circumstances of the shareholders. It can be a complicated issue, so make sure to check out our post on shareholder tax treatment here.

Why Protect Your Shareholders ?

Losing a shareholder to death or serious illness can be catastrophic. It is therefore critical to ensure that you protect your business and livelihood with shareholder protection.

The Benefits of Shareholder Protection

Shareholder Protection insurance offers several benefits for businesses and shareholders, including:

Overall, Shareholder Protection cover can be a valuable tool for businesses and shareholders to protect their interests, ensure business continuity, and provide financial security in case of unexpected events.

Should you get Shareholder Protection with or without Critical Illness cover?

Critical Illness cover is an additional feature that provides a lump sum payment in the event that a shareholder is diagnosed with a specified critical illness as defined by the insurance policy, such as cancer, heart attack, or stroke.Including Critical Illness cover can provide additional financial protection in case a shareholder becomes critically ill and is unable to actively participate in the business. It can then facilitate a buy back of the sharesThere are many shareholder protection providers in the UK who offer critical illness as part of the contract. Policies can vary greatly in terms of the illnesses that are covered so do your research and find out which ones offer the best cover. Our advisors can help you do this.

Why Choose Us?

Shareholder Protection Insurance Key man Insurance UK
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Shareholder Protection Insurance Key man Insurance UK

How to get a quote

3 Simple Steps

Shareholder Protection Insurance Key man Insurance UK

SUBMIT

Submit the details of the shareholders who need to be covered.

Shareholder Protection Insurance Key man Insurance UK

COMPARE

Compare the quotes online

Shareholder Protection Insurance Key man Insurance UK

APPLY

Fill out the application and get covered today.

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What people are saying about us.

Shareholder Protection Insurance Key man Insurance UK

Excellent service with easy to
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Jody was very helpful in explaining the options and I thoroughly recommend his company

We received a wonderful service
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We received a wonderful service from mykeyman and will be using them again. The service and product knowledge from team is excellent. Everything was made easy to understand. The price was the best we found too.

First Class Service

The standard of service was first class. They kept me up to date with progress on my Relevant Life Policy, followed up promptly following delays caused by my medical practice being slow in compiling reports, and responded instantly and clearly to any questions I had.

Further Reading

Shareholder Protection Insurance Key man Insurance UK

Shareholder Protection Tax Treatment

Check out our guide on the taxation of shreholder protection insurance. Make sure everything is set up correctly in the most tax efficient way.

Shareholder Protection Insurance Key man Insurance UK

Cross Option Agreements Explained

Shareholder Protection policies normally always need a cross option agreement. Check out our guide here.

Shareholder Protection Insurance Key man Insurance UK

Key Man Insurance Guide & Quotes

Maybe its key person insurance you need instead. Check out our guide for all you need to know about getting your key people insured.

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