How Premium Finance Life Insurance Works

Do I Qualify for Premium Finance Life Insurance?

Insured Qualifications: Age: between 35 and 85 years
Minimum Net worth: $3,000,000
Must be insurable and in relatively good health
For premium finance must be without life insurance OR have insurable headroom of $2,000,000+ (which is based on your net worth).

Are you in need of life insurance to:

protect against loss
to pay estate taxes
facilitate wealth a transfer
improve the performance of your current insurance policy
maintain the same life insurance coverage for a lower monthly premium (I.e. swap your current policy for a better performing replacement policy with lower monthly premiums or better guarantees)

Perspective insured (insurance candidate) must complete a universal insurance application (please see forms section)
The universal insurance application will then be distributed to the underwriting departments of all prospective insurance carriers to foster competition between the carriers and ensure the best performing policy, from the highest rated insurance carrier, with the best underwriting class is procured for your client.

After the insurance carrier underwriting has been completed, based on your age, the policy size you desire, the collateral you are willing and able to post, and the length of life insurance loan that you need, the premium finance lenders will then compete for your business.
2. The more lenders that compete for your premium financing life insurance , the more favorable the lending terms, interest rates, fees, collateral requirements, carrier acceptance, etc.

All of the premium finance life insurance lending offers received from the marketplace of carrier approved premium finance programs will be presented to you. We will ensure that you are given a full explanation of each premium finance life insurance program enabling you to digest and assimilate the benefits and requirements of each premium financing for life insurance program's offer.
After you meet with your legal/ tax advisors, we will be available to assist your advisors with their review of the premium financing for life insurance programs and address any questions they may have. After you decide on the premium finance life insurance program that will best fit your needs, we will move to the closing stage of the loan. After the policy is issued, the life insurance loan premium finance agreement are completed and signed by the insured, your trustees and your legal advisor. Next, the premium finance agreement must undergo a final review; providing they are complete, the lender will pay the target insurance premium on behalf of the policy's trust.

Keeping your policy for the term of the loan (five years, 10 years or for the life of the insured)

Additional Policy Options:

Maintain the policy until the insured matures and you receive the entire death benefit (minus the loan repayment) tax-free.
Refinance the loan to remove the primary lender (to achieve better lending rates and/ or lending terms i.e. refinance)
Per the terms of the loan agreement, personally repay the loan and maintain the ongoing premiums for the loan.
Extend the term of the loan with the original lender
After year two or beyond, seek the market value for the policy and if you no longer have a need for the coverage, *sell the policy on the secondary market for life insurance and use the proceeds from the sale to repay the loan, interest, any fees and keep all the sale proceeds above the loan obligation amount.

Contact us at (888) 511-5110 or info@premiumfinancedirect.com to learn more about which programs are best suited to your needs.

*Please consult with your tax advisor regarding any taxable issues.

**Note the sale of a life insurance will likely result in taxes being due on all or a portion of the sale proceeds.