Successful businesses and families have more to protect. Finding the required capital to pay the substantial premiums for large life insurance policies can require the selling of real estate or other illiquid assets. Market demand and tax consequences will impact the sale of these assets. For closely held businesses, capital is difficult to obtain as the company may be in growth mode and cash flow is already spoken for.
We have good news. There is a way to obtain the life insurance that you need without negatively impacting the assets you have worked so hard to build or substantially affecting cash flow. The strategy is called Premium Financing.
What is Premium Financing?
Premium financing is a strategy that provides you with the funds you need to pay your life insurance premiums without liquidating assets to cover the premiums or substantially affecting the cash flow in your business to cover the premiums. With premium financing you borrow funds at competitive interest rates to pay the premiums. You will need to provide collateral to secure the loan. This is done through the life insurance policy’s cash value and other performing liquid assets. Part of the policy death benefit is assigned to the lender to cover the outstanding loan balance in the event of death prior to the loan repayment. The remaining death benefit is paid to the beneficiaries.
This is an impactful strategy for:
Business Continuation Planning
Estate Planning
Asset Protection
Potential Asset Accumulation
Life Insurance Design
We design the right life insurance policy for your needs. We are here to educate you about the various types of life insurance and how they are leveraged to maximize the benefit for your family or business. Our relationships with multiple “AAA” rated life insurance companies enables us to attain the best pricing for our clients.
Life Insurance Portfolio Audit
An objective audit of your current life insurance portfolio can reveal significant opportunities to reduce out of pocket cost and increase death benefit. The life insurance marketplace is ever-changing. Ensuring that your life insurance portfolio is competitive and efficient will maximize its performance.
Loan Structure and Service
We find the right loan structure for your needs. Our network of lenders have the tools and flexibility to craft a deal that works for you. We are committed to the long term maintenance and care of your leveraged insurance portfolio.
Our Practice
Humble Beginnings.
We remove the stress of Purchasing Life Insurance. We work with a network of “AAA” rated life insurance carriers to design and obtain the best policy for your needs and we will find the right lender to finance the premium to ensure maximum flexibility and performance.
— Jonathan Webb