1. PROTECTING YOUR BUSINESS
Insure against the unexpected loss of a key employee
Your clients carry insurance coverage to protect their business from the loss of buildings and equipment, but what about their most valuable asset – their talent?
Case Study
Vince owns a large construction company and brought Mark on board in 2008 as his head engineer and general sales manager. Mark was hired to take the company to the next level, and is the primary driver of sales for the company.
If Mark were to leave the company for a competitor or, worse, pass away suddenly, the company would have significant exposure unless the company has key employee protection. Vince realizes this and wants to protect limit his company’s risk.
The 3 Primary Benefits of Key-Person Life Insurance Coverage:
Replace lost revenue
Access capital to
recruit and train new talent
Maintain business continuity
for clients, creditors and employees
The Solution
Protection and Financial Flexibility
Policy Design
Vince’s business purchases an indexed universal life (IUL) policy, with Mark as the insured. The business is the owner, premium payer and the beneficiary of the contract. In the event of Mark’s departure, the business can use the death benefit proceeds to help sustain its operations.¹
With an IUL policy, Vince can feel confident about having a solution that provides guaranteed protection and increases the financial security of his business. In addition, the IUL policy has the ability to accumulate cash value which also gives the business future ability to address other financial needs that may arise.²
The business purchases a $1,000,000 policy and pays a $6,328 premium per year or $126,560 over 20 years (Mark turns 65)
The cash value inside of the contract at Mark’s age 65 is $107,009
¹ Excluding Dividends
² Loans and withdrawals with reduce the policy’s cash value and death benefit, may cause the policy to lapse, and may have tax implications. If amounts are withdrawn from the indexed accounts prior to the end of the term, any interest earned for that term will be forfeited.
Hypothetical example assumes a male, age 45, preferred nontobacco, $1,000,000 level death benefit in a protection indexed universal life insurance policy, $6,328 annual premium paid in all years. Assumed rate 6%. State of North Carolina. Assuming 1% and current charges, policy lapses at age 86
Any information in this report should not be used in any actual transaction without the advice and guidance of a financial professional. Although the information contained here is presented in good faith, it is General in nature and may not be applicable to or suitable for the individual’s specific circumstances or needs and may require additional consideration of other matters. This report is for informational purposes only. It does not constitute a contract or guarantee. Please refer to the insurance company full illustrations for complete details.