Business protection is a little known but vital type of insurance, says advisors LifeSearch .It says that two of the most important types of cover are keyperson and shareholder protection.
The main aim of keyperson insurance is to ensure that the loss of someone important to the business is compensated to cover the financial impact on the business. However, not every director is a key man and will not necessarily be of the same value so businesses should consider each case individually depending on each director’s value to the business.
Shareholder protection is used to provide a payout when a shareholder covered by the policy dies. The money can then be used by the surviving shareholders to repurchase the shares, if required, which may have passed to a beneficiary who does not have the skill or experience to make a worthwhile contribution to the business.