What is Directors’ Shareholder Protection?
Directors’ shareholder protection is insurance that is specifically designed to ensure that should one the shareholding directors die or be diagnosed with a terminal illness the remaining shareholders will have access to sufficient capital to buy the deceased’s shares from his/her estate. Each shareholding director takes out a life insurance policy written into trust for the other directors. Typically, there will be a legal agreement put in place, such as a cross option agreement, giving clarity on the process an options in this event
What is the danger in not having this insurance in place?
If a shareholding director were to pass away, his shares will form part of his estate and be passed on to his beneficiaries. This is typically not problem free. The beneficiaries may not want the shares or involvement in the company and might prefer to receive the cash value equivalent instead. At a time when a director has just passed away it could be difficult for the surviving shareholders to rise this capital at this time, either within the company or via bank lending. Individual directors may prefer to understand that, in the event of their death, their family would not have to be concerned with suddenly finding themselves the owners of shares in a company they may have little interest in, or the necessary skills to contribute to.
Your home or property may be repossessed if you do not keep up repayments on your mortgage.
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With advances in medical care more and more people are now surviving illnesses once thought to be fatal.
Protection insurance is designed to help when the things we hope will never happen to us, do!
Protecting your future is important and Income Protection can protect your income and make sure that money is there when you need it most.
This cover can give you the peace of mind of knowing that in the event of redundancy or illness your mortgage payments will be made.
Your home is probably the largest single financial commitment you will make in your lifetime, so protecting it is so important.
You insure your car, your home, and your valuables - isn’t your health the most important asset of your life?
Relevant life insurance is a tax efficient way of a company providing life insurance for its employees, including directors of limited companies.
Directors’ shareholder protection is insurance that is specifically designed to ensure that should one the shareholding directors die or be diagnosed with a terminal illness the remaining shareholders will have access to sufficient capital to buy the deceased’s shares from his/her estate.
Key person insurance helps safeguard a business against the financial effects of the death or critical illness of a key member of staff
Watts Mortgage & Wealth Management Ltd is directly authorised and regulated by the Financial Conduct Authority.
We are entered on the Financial Services Register No 624815 at www.fsa.gov.uk/register/home.do
More information is available on mortgages from the Money Advice Service. www.moneyadviceservice.org.uk
Where you have a complaint or dispute with us and we are unable to resolve it to your satisfaction then we are obliged to offer you access to the Financial Ombudsman Service. Please see the following link for further details www.financial-ombudsman.org.uk
Your property may be repossessed if you do not keep up repayments on a mortgage or any other debt secured on it.
The FCA does not regulate some forms of mortgages. The FCA does not regulate taxation advice, trust advice and some forms of buy to let mortgages.