Shareholder Protection Insurance
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Shareholder Protection insurance ensures that if a shareholder dies or becomes critically ill, the remaining shareholders have the funds to buy back their shares rather than finding themselves in business with the deceased's family, or a distressed seller, or worse, an unknown third party. It's a pre-agreed solution to a scenario most founders don't want to think about, until they have to.
What This Covers
Lump sum payout to fund the purchase of a deceased shareholder's shares- Critical illness trigger (where included), allowing buyout before death
- Funds to maintain business continuity during ownership transition
- Protection for remaining shareholders' voting control and strategic direction
- Cover aligned to current share valuation (reviewed at renewal)
What This
Does NOT Cover
Voluntary share sales or buyouts triggered by resignation or dispute- Business disputes not linked to death or critical illness
- Valuations not agreed at policy inception or within the cross-option agreement
- Claims where health conditions were not disclosed at inception
- Tax liabilities on the transfer of shares (take specialist advice)
Illustrative
Claim Example
Illustrative Example
A three-founder SaaS business, each holding equal shares, had shareholder protection in place. One founder died suddenly at 41\. Without the policy, his 33% stake would have passed to his estate, leaving the surviving founders unable to act without the estate's consent on major decisions. The policy paid out £420,000 — the agreed share valuation — to the business, which was used to buy the shares from the estate under a pre-agreed cross-option agreement. The business continued without operational disruption.
The right cover keeps your business protected when it matters.
Protect Your Business
Who
Needs This Insurance
Businesses with two or more shareholders who are active in the business
Companies where one shareholder's death could destabilise control or direction
Founder-led businesses where shares have significant and growing value
Companies with external investors who require shareholder protection as a condition
Who Needs This Insurance
Ready to
get covered?
Get a quote for Shareholder Protection and a cross-option agreement structured for your business.
