When a co-owner of a company dies unexpectedly, apart from the loss of their day-to-day input into the business, their shareholding will be passed on as part of their estate in the normal way. If their beneficiaries choose to sell the shareholding, there is no guarantee that the new buyers will have the same vision or priorities as the deceased.
In these circumstances, it may be in the best interest of the business for the remaining shareholder or shareholders to buy the shares. However, most companies do not plan for such an eventuality.
The same need arises when the co-owner becomes seriously ill and unable to return to work. Although shares do not pass to beneficiaries, it may be desirable for the co-owners to have options to buy or sell the shares.
How it works
Share purchase protection covers one nominated individual, who can be a partner or an employee.
Further information... Who should I talk to?
Speak to your financial adviser to find out more. If you don't have an adviser, the IFA Promotion Service or the Society of Financial Advisers can help you find one.