Glossary
Premium Finance Life Insurance
- is when a bank lends the money to purchase and pay the premiums on life insurance and the bank is later repaid from the death benefit. This allows the borrower to acquire a life insurance policy without having to liquidate their investments or savings to pay the policy's premiums. The bank's loan can either be collateralized by a personal guarantee, other assets of the purchaser and by the partial asset value of the life insurance policy. It is generally true that the greater the collateral posted by the borrower, the lower the interest and fees changed by premium finance lender
It is the intent of Premium Finance to provide accurate and complete information regarding the definitions contained within the glossary of our website and although every effort has been made to ensure the accuract or completeness of this information, Premium Finance direct does not warrant or represent the accuracy or completeness of this information, but rather intends that this information be used as an informal resource guide. Most importantly, it is recommended that you consult with your insurance carrier(s) and your own insurance, legal and tax professionals regarding questions regarding new or existing life insurance coverage.