In many private companies, the directors hold all the shares. What happens if one of them dies? His or her shares might end up in the hands of someone with no business skills – or has no interest in the company.
The death or permanent incapacity of a shareholder or partner can cause a shift in the balance of power within a business and can create financial difficulties for the surviving shareholders, partners and their beneficiaries:
One solution to such a scenario is Share Protection which can take the sting out of this situation by providing an injection of capital.
It is therefore in the interests of all interested parties to plan and finance business continuation, in the event that a shareholder or partner dies or becomes critically ill.