Premium Finance

Life insurance is a valuable planning tool for many high net worth individuals and business owners. It is a tax efficient solution that helps provide security and liquidity after a death, helps to simplify business and estate plans, and can be used as a benefit that is both flexible and portable.

But often the large premium payments required to pay for the coverage can create a cash flow issue (think rich in assets but cash poor). Premium Finance is a popular insurance and estate planning technique that can help alleviate the cash flow issue by borrowing the money to pay the life insurance premium from a third party lender.

A well designed premium finance strategy will strengthen an estate or business plan and help overcome planning obstacles such as cash flow to pay premiums without liquidating assets.

Preservation of income and capital – the owner maintains greater control of their cash flow and may avoid liquidating assets to pay life insurance premiums.

Flexibility – customized financing plans are tailored to a client’s individual needs and objectives.

Minimize or eliminate gift taxes on policy premiums– use gift tax annual exclusions and lifetime exemptions to transfer other assets and minimize or eliminate gift taxes on policy premiums if the policy is owned by a trust.