All too often, the majority of a business owner’s estate is tied up in the value of the business. Without an effective estate plan, including a business succession plan, the business may have to close or be liquidated to pay estate taxes.
With the proper use of business owner life insurance, a business owner can provide the liquidity needed to pay any estate taxes due at his or her death.
Assure-All will work within your overall plan to ensure you meet your estate planning needs.
Simply CLICK HERE to visit our business owner life insurance page and submit the contact form for immediate assistance.
Sunday, September 28, 2008
Asset Accumulation for the Business Owner
Smart business owners use life insurance as an essential means to protect their businesses but they also use life insurance as a vehicle to accumulate cash and future retirement income.
Life insurance policies offer a unique combination of death benefits and tax advantages available in no other financial product. These advantages include tax deferred growth as well as the potential to access policy cash values without paying taxes via withdrawals and policy loans.
Additionally cash value inside a life insurance policy may be protected from creditors making it an especially effective tool for business owners to use to grow their assets. For more information on accumulating cash inside a life insurance policy CONTACT US by submitting the quick contact form.
There are many policy choices available including traditional whole life insurance as well as variable and equity indexed universal life policies. The type of business owner life insurance policy to use depends on the desired objectives of the business or business owner.
At Assure-All we have senior level advisors with decades of experience in guiding business owners towards success. Visit our Businesss Owner Page and submit the contact form for assistance.
Life insurance policies offer a unique combination of death benefits and tax advantages available in no other financial product. These advantages include tax deferred growth as well as the potential to access policy cash values without paying taxes via withdrawals and policy loans.
Additionally cash value inside a life insurance policy may be protected from creditors making it an especially effective tool for business owners to use to grow their assets. For more information on accumulating cash inside a life insurance policy CONTACT US by submitting the quick contact form.
There are many policy choices available including traditional whole life insurance as well as variable and equity indexed universal life policies. The type of business owner life insurance policy to use depends on the desired objectives of the business or business owner.
At Assure-All we have senior level advisors with decades of experience in guiding business owners towards success. Visit our Businesss Owner Page and submit the contact form for assistance.
Buy-Sell Agreement Funding and Life Insurance
A buy-sell agreement is a legally binding contract which states that at an owner or partner’s death, disability, retirement or otherwise separation from the company, the individual’s interest in the company must be sold back to the business or to the remaining owners at agreed upon terms.
These agreements are crucial for small and closely held companies, as in many cases, the death or disability of a business owner creates a significant financial burden on the business as well as the remaining partners. To limit this potential risk, most buy-sell agreements are funded with life insurance and or disability insurance policies.
Depending on the type of buy-sell agreement, the business itself or the individual partner(s) acquires a policy on each owner/partner so that at death or disability the funds needed to “buy out” the individual’s ownership interest are readily available.
Assure-All specializes in assisting in such matters.
Simply CLICK HERE and submit the quick contact form for immediate assistance.
These agreements are crucial for small and closely held companies, as in many cases, the death or disability of a business owner creates a significant financial burden on the business as well as the remaining partners. To limit this potential risk, most buy-sell agreements are funded with life insurance and or disability insurance policies.
Depending on the type of buy-sell agreement, the business itself or the individual partner(s) acquires a policy on each owner/partner so that at death or disability the funds needed to “buy out” the individual’s ownership interest are readily available.
Assure-All specializes in assisting in such matters.
Simply CLICK HERE and submit the quick contact form for immediate assistance.
Life Insurance as Loan Collateral
Loans are crucial to the expansion and growth of small businesses. Whether your business is acquiring funds from a local bank or a private lender, many of these institutions will require life insurance on the business owner(s) as security for the loan.
In most cases, inexpensive term life insurance policies that offer guaranteed level rates for the duration of the loan can be purchased to satisfy this requirement. When buying life insurance to secure a loan, the company pays the premiums, owns the policy and is the named beneficiary.
As soon as the key man insurance policy is effective, a collateral assignment agreement can be signed by the business owner and the bank. The collateral assignment is a lien against the policy proceeds. In the event of the business owner’s death, the bank would have first rights to the policy proceeds in the amount of any outstanding loan balance due. The business would then receive any remaining proceeds.
In most cases, inexpensive term life insurance policies that offer guaranteed level rates for the duration of the loan can be purchased to satisfy this requirement. When buying life insurance to secure a loan, the company pays the premiums, owns the policy and is the named beneficiary.
As soon as the key man insurance policy is effective, a collateral assignment agreement can be signed by the business owner and the bank. The collateral assignment is a lien against the policy proceeds. In the event of the business owner’s death, the bank would have first rights to the policy proceeds in the amount of any outstanding loan balance due. The business would then receive any remaining proceeds.
Key Man Insurance for Business Owners
With many small businesses the key man or key employee in the business is the business owner. In these cases, key man life insurance can be purchased on the life of the business owner to protect the company in the event that he/she unexpectedly passes away.
With key man life insurance, the business owns the insurance policy and pays the premiums and is also the beneficiary. If the business owner dies, the business receives the policy proceeds and can use the funds to hire a capable replacement, pay off debts or simply use the funds to buy time until the businesses assets can be liquidated and the business can be closed. In any event, key man life insurance on the business owner can provide much needed stability if there is a sudden and unforeseen death.
With key man life insurance, the business owns the insurance policy and pays the premiums and is also the beneficiary. If the business owner dies, the business receives the policy proceeds and can use the funds to hire a capable replacement, pay off debts or simply use the funds to buy time until the businesses assets can be liquidated and the business can be closed. In any event, key man life insurance on the business owner can provide much needed stability if there is a sudden and unforeseen death.
Business Owner Life Insurance - Common Uses
Business Owner Life insurance has long been a valuable tool that business owners use to reduce risk and to provide the basic financial foundation for continued success. Most business owners recognize the importance of life insurance and use it to solve many of the problems associated with maintaining and growing a successful company. Some common uses of business owner life insurance include: key man life insurance, security for loans, buy-sell agreement funding, asset accumulation and estate planning.
Assure-All has been assisting and specializing in meeting the needs of business owners for decades. To get immediate assistance simply CLICK HERE and fill out the quick contact form.
Assure-All has been assisting and specializing in meeting the needs of business owners for decades. To get immediate assistance simply CLICK HERE and fill out the quick contact form.
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