Shareholder protection
Shareholder protection: Avoid losing control of your business and protect your shares
If a shareholder passes away, usually their shares are passed to the family members of their estate. These family members could then take over the deceased’s position as shareholder and there is no guarantee they would contribute any value to your business.
Similarly, the family member could become a sleeping partner who doesn’t help run the company but is entitled to a share of the profits. Also, the family member may be unhappy if they have no control over the direction of a business that they rely on for income.
Finally, the family members could sell their interest, leaving the remaining partners working as minority shareholders with an unwelcome new partner. Or if there are no natural buyers, both the family and the company could face financial problems.
How would your company cope?
How can you prevent this?
Shareholder protection insurance is a form of business life insurance that covers you, your business, and your shareholders. It pays out a lump sum if a shareholder passes away.
The lump sum provides the necessary funds so that the surviving shareholders buy back the deceased shareholder’s share in the company.
What are the costs?
The costs will vary depending on your personal circumstances, once we have some key information from you, we will obtain quotes for shareholder protection insurance from the leading UK insurers.
Often the premiums are guaranteed to remain level throughout the term of the policy and can be cancelled at any time without a penalty.
How do I establish the right amount of cover?
It is important to understand how each scenario will affect you. As it is a dynamic insurance with lots of factors to consider, we would need to complete an income, expenditure, asset, and liability analysis for you. The outcome of this analysis will show a colourful chart of the effects, of your net worth over time and ultimately work out the cover needed should there be a shortfall.
What are the benefits of speaking to CBW’s business protection advisers?
- Save you time – Being specialists protection insurance advisers, we know all the products inside out, saving you time in finding the right policy.
- Save you money – The Business Protection team at CBW are independent, so we can search the whole market to ensure you gain the most competitive long-term premiums.
- Access more insurers – Some insurers do not allow their policies to be quoted online so you can access a wider number of options by speaking to CBW.
Contact us
CBW Financial Planning Limited is authorised and regulated by the Financial Conduct Authority. FCA registered number is 182357. Registered in England. Registered number is 3224548. Registered office is 10 Lower Thames Street, London, EC3R 6AF. CBW Financial Planning Limited is a related business of CBW 2022 LLP. The Financial Ombudsman Service is available to sort out individual complaints that clients and financial services businesses aren’t able to resolve themselves. To contact the Financial Ombudsman Service please visit www.financial-ombudsman.org.uk. The value of investments and the income from them can fall as well as rise. You may get back less than you originally invested. Past performance is not a reliable indicator of future results.
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