WHAT WOULD HAPPEN IF YOU LOST A SHAREHOLDER?
Shareholder Protection Insurance
What is it?
Shareholder Protection insures each shareholder for the value of their shares. If they die or are permanently disabled the other shareholders receive a lump sum payment to “buy out” the departing member’s shareholding, according to the stipulations of the “Buy Sell” agreement.
Do you need it?
Yes, if you wouldn’t be able to afford to ‘buy out’ their shares in the event of death or disability, and you want to have control over who you end up in business with. Otherwise you could potentially be forced to welcome a beneficiary of the shareholder’s estate.
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