Shareholder Protection Insurance

Help avoid disruption to your business if a business partner dies or becomes critically ill.

What is Shareholder Protection Insurance?

Shareholder protection insurance, also called buy/sell agreements, allows business owners to buy shares back from any partner upon diagnosis of a critical illness, terminal illness or death. This policy enables surviving owners stay in control and minimises disruption to the business. The deceased owner’s dependants have a willing buyer and cash instead of a share of the business.

Common reasons for taking out shareholder protection insurance include:

  • Maintaining control of the business by being able to buy the deceased’s or critically ill person’s shares
  • Making the transition of shares from one owner to another as smooth as possible.
Shareholder Protection Insurance

How does Shareholder Protection Insurance work?

Shareholder protection insurance is a contract between all the shareholders of your business, which sets out exactly what will happen if one of you is no longer able to participate in running it. You can insure against the death of a shareholder, or against serious illness or injury. The agreement allows the remaining shareholders to buy their shares in the business at an agreed price, using a lump sum payout from your insurance company.

Looking for expert advice about Shareholder Protection Insurance?

Request a free callback with an adviser who can help you find the most suitable policy to meet your specific company’s needs and budget.