Partnership Protection
Find out how partnership protection can benefit
traditional partnerships and LLPs in the event of
a critical illness or death.
Partnership Protection
When you’ve spent years building your business, then you want to protect it. Threats can come from competitors, regulation and also internally. Our advisers can help you and other partners maintain control of your business in the event one partner suffers a critical illness or dies.When you insure your business with partnership protection, remaining partners would receive a lump sum payment to enable them to purchase the interest from the critically / terminally ill partner or if they have passed away, their estate.
Partnership & LLP protection insurance
Limited liability partnerships (LLP) and traditional partnerships can protect their business in the event a partner becomes critically ill or passes away.
In a scenario where a partner passes away, their relatives (beneficiaries of the estate) may wish to sell their interest in the business if there is no Partnership Agreement. This means that remaining partners – if they didn’t have the available funds to purchase the interest themselves – could be forced to accept a new partner. If the partner is terminally or critically ill then they could decide they need to sell their interest to fund their care or supplement their income.
Within an LLP, the business will continue if a member dies, but profits will be paid to the estate of the deceased partner. Consequently, you will have fewer partners, but the profits continue to be split equally. It can also mean you’re not in a position to strengthen your business and make robust plans for the future.
Financially protect your partnership
Each partner can purchase a protection insurance policy that’s written into trust. The protection can provide life or critical illness and life insurance. There are various options available to ensure partners are protected and one of our qualified business advisers can explore these options with you. The process is free, confidential and comprehensive.
A qualified adviser, experienced with business protection will listen to your needs and propose options that can financially protect your interests, should something unforeseen happen. You can then make an informed decision about which policy is right for your business.
Enquire For Financial Advice
Contact Information
If you would like to discuss how you can financially protect your partnership in the event of a critical illness or death, please get in touch.
Our expert financial advisers can provide comprehensive advice that’s tailored to your organisation. With your approval, we will source and present policies that meet your requirements, provide adequate cover and are within budget. You and your partners can then decide if you wish to proceed.
To find out more about our processes and how our qualified advisers can help you, please get in touch.
Frequently Asked Questions - Partnership Protection
What is partnership protection?
Partnership protection refers to the measures taken by partners to safeguard their interests, assets, and control within a partnership. This can include strategies to prevent disputes, protect the partnership’s reputation, and ensure the smooth operation of the business. If one partner is critically ill or dies, would the remaining partners or business be able to buy out the interest from the Estate? If not, partnership protection is vital to maintain the financial stability of the company. Even if the business does have the money to pay the family their equity, do you want to use company funds (or your own personal funds)?
Why is partnership protection important?
Partnership protection is crucial because it helps to maintain stability if a partner is critically ill or dies. Unfortunately we don’t know what will happen in the future and people of working age can become critically ill or die.
How much will partnership protection cost?
The specific costs will be determined based on a number of factors (number of partners, value of the business, how much you wish to insure etc). Our free consultation will help you explore the process of setting up a policy, the costs and the benefits to your organisation.