Premium Financing
You've financed your home. You've financed your business. Now, finance your life insurance with Premium Financing.
What is Premium Financing?
Premium Financing is an advanced technique whereby a third-party lender offers funds to qualified borrowers to pay life insurance premiums and the borrower merely pays loan interest paid, in advance or in arrears, each year.
It is a new way to meet business or estate planning insurance needs without sacrificing valuable assets or affecting net worth. Premium Financing is a tool to enhance almost any planning strategy with life insurance.
Why Finance Your Premiums?
Since adequate life insurance usually requires significant premium payments, Premium Financing is an ideal solution. There is no need to liquidate assets to pay premiums thereby allowing you to keep your assets invested while enjoying benefits of life insurance protection.
Premium Financing can help you achieve long-term life insurance planning goals without affecting current assets. It reduces your out-of-pocket life insurance costs. You borrow funds at competitive interest rates and reduce gift taxes within estate plan at the same time.
Are You a Candidate for Premium Financing?
To become eligible for Premium Financing, you must:
- Have a net worth of at least $5 million.
- Purchase a policy or policies with minimum total annual premium of $100,000.
- Be an entity such as an irrevocable trust, corporation, partnership or LLC.
- Satisfy collateral requirements.
- Accept a variable rate of interest on annual financing of premiums.