For businesses with more than one shareholder, people often choose to protect their shareholding, as well as the shareholdings of their fellow partner(s), with Shareholder Protection Insurance.
This protection is not just for the business. It also offers financial help to the family of a deceased shareholder who inherits the shares in the business after their loved one passes away.
There are various methodologies to valuing a business depending on its type and size.
We often work in consultation with your accountant to place a suitable value on your business and your shareholding.
One of the most commonly accepted methods of valuation is applying a multiple of net profit of the company. You then base your Shareholder Insurance on your proportion of the total shareholding you own.
However, there are also other ways to value a business depending on its size and the number of shareholders. For example, an adviser may examine:
However, this isn’t a strict set of guidance. Every company is different and the value of two companies, even within the same industry with similar metrics, can be very different.
If you’re unsure about the value of your business, we’ll work with you to find the most appropriate metric to use.