Specialized Business Policies

---

There is a reason that most of the worlds wealthiest individuals have numerous life insurance policies. The tax benefits associated with life insurance policies as well as the positive equity and cash value make them an essential part of any financial portfolio. Sadly many business schools do not offer courses on understanding the fundamentals of the various benefits of insurance for business owners. Most entrepreneurs understand what an investment portfolio or 401k is however the tax implications of those types of investments often lead to greater overall expenses. Setup your free one on one consultation with one of our experts today to learn more about how you can grow and protect your wealth. 

Starting or running a business with a partner is no easy undertaking, the level of trust required to maintain a successful partnership is immense. Successful partnerships are built on this foundation however there are times where the unspeakable happens and a partner passes away unexpectedly. Many smaller partnerships rely heavily on the involvement of all partners which means a sudden loss could potentially take the business with it. Beyond standard whole life policies there are life insurance options specifically designed to shield businesses and surviving partners from this type of loss. 

Buyback Protection Insurance is a specific type of policy that a business takes out on the owners or majority shareholders. The primary logic behind obtaining this type of policy is to allow for a business to "buy back" the deceased owners shares or interest from the individuals estate. This protects the business from potential issues with the dispersion of the deceased estate. Buyback policies also offer protection for the financial security of a business, mass dispersion of ownership through an estate can create a high level of uncertainty which can have negative impacts on a stocks valuation.   These policies also offer a level of security for the families of the deceased to be able to obtain the full cash value of the the business interest while maintaining certain tax and legal benefits. 

When businesses grow and begin to hire, generally their first employees are there to fill very important roles. These "key" employees are often the force propelling the businesses to the next level. Sadly tragedy is not something that can usually be anticipated, when a business loses a key employee suddenly the impact on the businesses cashflow can be extreme. It often takes substantial time to find and train someone to fill the vacant role. Key Employee Policies offer protection for the business in the event that a key employee is lost by providing a tax protected cash infusion to the business to overcome any financial losses. 

One of the biggest decisions any entrepreneur or business owner has to make is how to ensure their future financial needs for when they decide to retire. There are a variety of options all with different levels of tax implications or benefits. A popular option that gets overlooked by many business owners is an Income Replacement Policy. Income Replacement Policies offer a tax sheltered alternative for standard retirement accounts. Unlike 401(k)s which offer tax deferred growth (meaning it is taxed when it is cashed out) Income Replacement Policies grow at a tax free interest rate. This policy type can also be structured to allow for for additional payments to be made to the cash value of the policy providing a guaranteed growth rate without the risks of the stock market. Income Replacement Policies are designed to begin to pay out at a specific point and continue to pay out for the remainder of the owners life.