Buy/sell funding in case of disability

This insurance finances in part, or in whole, the share buyback in case of a prolonged shareholder disability.

Your shareholder agreement dictates the process in case of disability.

Will you have the necessary capital to buy back shares?

The financing of share buyback in case of disability is often neglected. The consequences of such a situation can have huge implications.

Share Buyback in Case of Disability Policy

This type of policy provides a monthly benefit or a lump sum to the business following the disability of a shareholder.

When does the benefit begin?

You can decide when the benefits begin (usually after 12, 18, 24, or 36 months).

How will the benefits be paid?

You choose:

  • As a monthly payment for 24, 36, or 60 months;
  • As a lump sum;
  • As a combination of monthly payments and lump sum.

Amount of benefits?

The amount of benefits paid is established using the fair market value of your company shares. This amount is assessed in a manner consistent with business valuation standards such as those of the Canadian Institute of Chartered Business Valuators or similar standards as approved by the insurer, up to the buyback value.

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