Premium Financing

Premium financing is one of the many concepts that we build for our personal and corporate clients.

This concept usually appeals to clients that are:

1. Needing permanent life insurance but would rather purchase and invest instead.
2. Want to increase the rate of return on an estate planning concept that incorporates life insurance.
3. Use of the capital dividend account.
4. Want to take advantage of the one or more existing life insurance policies that have cash surrender value already established for the purposes of borrowing for investment purposes.

The concept is built in the following way:

1. Purchase a permanent life insurance policy which is built to create a significant cash value.
2. Assign the policy to a lending institution as collateral to secure a line of credit…(of which we have 5 lenders that are available to Kaye Consulting for the purposes of this concept).
3. Client pays the annual premium.
4. Client borrows back 100% of the cash value or the entire premium by providing additional collateral.
5. Client uses the line of credit for investment purposes, such as real estate, operating expenses, or investments.
6. When the life insured passes away, the outstanding loan is repaid out of the death benefits and the remaining monies are paid to the beneficiary.

There are several ways to structure this concept both on a personal basis and corporate, and for the right client is a very powerful program to create cash flow and a zero cost!