Premium financed life insurance allows Ultra-Affluent individuals to borrow funds through major US lending institutions at favorable rates to pay life insurance premium.
Why would an Ultra-Affluent individual want to borrow money to pay life insurance?
Ultra-Affluent individuals usually have access to the lowest cost of capital.
Premium normally paid for life insurance can continue to be managed in their investment accounts or left in their business.
Clients can benefit from potential arbitrage between the growth in cash value in the insurance policy versus the interest due on the loan each year.
This is not free insurance; however it can be a much more cost effective way to purchase large amounts of life insurance than by just paying premiums each year.
Pfleger Financial custom designs plans for our clients to achieve maximum efficiency. We design plans that use reasonable assumptions taking into account each client’s risk tolerance and access to capital. Each design has an exit strategy to pay off the loan to the bank.
Variable life and annuity products, as well as other securities products, may be sold in the following states: Arizona, California, Colorado, Connecticut, Delaware, District of Columbia, Florida, Georgia, Illinois, Maryland, Massachusetts, New Jersey, Nevada, New York, Ohio, Pennsylvania, Texas, Utah and Virginia. Residents of other states should consult with a local registered representative for securities products.
Proper state registration is mandatory prior to conducting business in any state. Securities offered through M Holdings Securities, Inc., a registered broker dealer, member FINRA / SIPC. Pfleger Financial, Inc. is owned and operated independently from M Holdings Securities, Inc. Pfleger Financial, Inc. is a member of M Financial Group. Please go to mfin.com/DisclosureStatement.htm for further details regarding this relationship.