Sunday, 10 April 2016

What if your business partner died today? GWM unveils insurance policy to protect companies and next-of-kin.


Dubai-based Guardian Wealth Management launches Partnership Insurance policy to help start-ups stay afloat amid tragic circumstances and ensure legal beneficiaries are fully compensated. 

April 10, Dubai: The Dubai-based financial planning company Guardian Wealth Management (GWM) has unveiled an insurance policy that protects company co-owners in the event of their business partners’ death or critical illness.

Many of the UAE’s small businesses are set up as partnerships with two friends becoming equal shareholders. But if one of the partners were to die or suffer a critical illness, their holding would pass to their next-of-kin as opposed to the co-director who helped to build the company from scratch.

GWM’s new Partnership Assurance policy is designed to allow the unaffected partner to take full control of the company, while ensuring that the family of the deceased shareholder is financially compensated if they decline to take a holding in the business.

Hamzah Shalchi, who manages GWM’s Dubai operations, said: “In all the excitement of setting up and running a company with a business partner, it’s understandable that no one wants to consider what happens in the event of a tragic accident or illness.

“But after such an unfortunate event, there is a real possibility that businesses can fall apart without the proper planning and agreements in place. Everything that the partners have worked so hard together to achieve can suddenly be lost.”

Mr Shalchi said GWM has experienced a case where the co-director of a private company founded in the UAE died suddenly. His will meant his stake in the company went to his wife.

“We had an unfortunate situation where a grieving widow was left with a 50 per cent stake in a company that she had no interest in, while the other business partner was left to run the company by himself,” he said “The ideal scenario would have been for the widow to be financially compensated and the other director to take full ownership of the company he helped to build.

“Our Partnership Assurance is basically an insurance policy that’s taken out in order to cover the costs of the affected director’s stake in the business. We’re getting a lot of interest in the policy among company co-directors who are rightly planning ahead for worst-case scenarios.”

GWM also offers a Key Man Insurance policy, which is designed to cover the cost to a business should the death of a key member of staff occur that would threaten the viability of the company.

Under the policy, the company takes out life cover on its key employees and becomes the beneficiary of the policy. If any one of those people were to die, the company receives a pay out from the insurance company. The company can then use the pay out to find a replacement person or to pay off debts.

For more information on Guardian Wealth Management, please visit