All About Business Protection Life Insurance

Update Sept. 02 - 2010 All About "Business Life Insurance" Information By Insurance Experts

2010-08-31T12:39:00.000-07:00

It is important that people own a business understand what is business insurance, so they can protect their business in case of any unforeseen event happened causing hardship to the business owner and their family such as business store burned down one day, if you don't carry insurance, you would endured some hard times after that. You make sure you have insurance for anything importance, or anything that could prevent you from earning a living.

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What Happens If My Life Insurance Company Goes Out of Business?
By Ed Hinerman

Fair question - since over the past ten years we have seen some shocking things happen in business. Highly rated, highly respected companies biting the dust. What about Enron? Not an insurance company, but poor management of a large trusted company.
So, what if it had been an insurance company? What if it had been a life insurance company where you happened to have all of your family protection? What if it happened to be the company that had sworn it would fend off disaster for your family if you were to die prematurely? Enron just disappeared. Poof! Gone! Is that the same thing that happens when an insurance company goes under?
The good new is the answer is no. There really isn't any way to compare Enron with, say, Empire General went out of business a few years ago. A lot of my clients had policies with them so I got a lot of calls about what was going to happen. The truth is that Protective Life picked up their entire block of business and kept it intact, didn't change any of the terms (they couldn't by law) and those policies are fully in force today.
Maybe that wasn't a fair example because Empire General was part of the Protective Life Group to start with. But the same held true for Federal Kemper when they were purchased by Zurich, Zurich when they were purchased by Chase, MONY and US Financial when they were purchased by AXA Equitable and Travelers when they were purchased by Met Life.
With insurance companies the block of business has value because of the cash flow from premiums. I guess there should be some distinction drawn here between term insurance and non guaranteed cash value policies. With term insurance there aren't any moving parts. Premium and death benefit. If another company is looking at buying a block of business, a lack of moving parts, bells and whistles is a good thing.
With cash value policies, and specifically cash value policies that are not fully guaranteed, I think some concern about what happens if the company goes under is warranted. While it is as close to an absolute that the block of business will be purchased if it is all fully guaranteed policies, I honestly can't think of a reason that a company would buy a block of non guaranteed business unless the downside on that part of the business was dwarfed by the upside on the guaranteed portion.
Bottom line. If you have a guaranteed level term policy I wouldn't worry about your company. The only thing that will change if they go out of business is who you make the premium check to. By law everything else, the premium, term length and death benefit, has to remain the same.
If you have a variable universal life, or a universal life or whole life policy that is dependent on assumptions and not guarantees, I would switch to something fully guaranteed before you have to find out if it will survive your company's demise.
About The AuthorEd Hinerman has focused his attention and made it his priority to help people with health issues get life insurance they can afford. Visit http://www.hinermangroup.com for more information.
Ed blogs about his insights and tips on life insurance here http://www.hinermangroup.com/blog

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Update August 19 - 2010 All About "Business Life Insurance" Information By Insurance Experts

2010-08-18T06:36:00.000-07:00

What is Key Man Life Insurance (also known as Key Person Life Insurance)?

Most companies employ at least one person who represents the key to the success of the business (often the owner of the company). The loss or death of that person could deal a real blow to the company and its ability to generate revenues to survive - someone else must be hired to carry on the same tasks performed earlier, and that expense, in addition to the loss of revenue, must be reconciled. Many owners therefore insist on buying life insurance to minimize the risk, and many lenders require that the business carry key person life insurance to protect their loans and investments into the company.

How does it work?

The key person must agree to the purchase of insurance on his/her life. The business typically owns the policy, pays the premiums and remains the beneficiary. The policy can be transferred to the employee if he/she leaves the company, or can be retained if the company is sold - the new purchasers may want to keep the insurance in recognition of the outstanding loans that may be secured to buy the interests of the insured.

Are there other reasons to have Key Man Life Insurance?

Key person policies are often used as well to support a buy-sell agreement between business partners. The proceeds can be structured to purchase the deceased person's shares or interests in the company. The agreement mandates that the deceased executive's estate sell its stock to the remaining partners/shareholders, and that the partners/shareholders purchase the interest for a specified price. The price should help establish the value of the business for estate planning purposes and calculating the estate tax upon death.

David M. Goldenzweig
Goldenzweig Financial Group
Haymarket, Virginia 20169
Toll-Free 1-877-656-1436
E-mail david@terminsurancebrokers.com
Website - http://www.terminsurancebrokers.com

Corporate and Personal Life and Health Insurance
Life - Disability - Long Term Care - Employee Benefits

Article Source: http://EzineArticles.com/?expert=David_Goldenzweig

Update August 02 - 2010 All About "Business Life Insurance" Information By Insurance Experts

2010-08-01T08:40:00.000-07:00

You've worked long and hard to build a business. You are now at a point where retirement isn't that far off and the idea of leaving the business to your kids is attractive. Even better, they are interested in taking it over. Now all you have to do is figure out how to deal with the succession process. Life insurance will pay a big role.

Mention the name IRS and nearly everyone will start grumbling. Unless you've gone through a "super audit", you haven't experienced anything even close to dealing with the agency on a business transfer after an owner has passed on.

The agency isn't really at fault. The tax code written by Congress is the problem. It calls for estate and gift taxes to be paid on the passing of an individual for any transfers made to heirs excluding the spouse. Put in English, this means there are going to be tax ramifications for transferring the business to your kids. Big taxes.

Even better, the payment of taxes is due nine months after the passing of the person in question. That might not sound too bad, but think it through. A business is an illiquid asset. How do you come up with a huge chunk of change for something that might make a lot of money, but is itself rather intangible? You can't. This is the reason the Los Angeles Dodgers were sold by the O'Malleys and the Miami Dolphins were sold by Joe Robbie's heirs. There was no other way to come up with the tax bill.

Most of us don't have businesses that are worth hundreds of millions of dollars. A business worth $5 million or so might not be as glamorous, but it is a lot easier to transfer. One way to come up with the cash to pay taxes is life insurance. The policy is taken out on the life of the owner. When they pass, the insurance company pays out a large sum that can be used to pay the taxes. The life insurance has to be positioned correctly in an overall estate plan, but it can be the key to keeping a business in the greater family instead of selling it in a panic to pay the IRS.

Ultimately, that is what you want right?

Barry Milton writes about succession planning and other financial planning subjects for UFCAmerica.com.

Update July 16 - 2010 All About "Business Life Insurance" Information By Insurance Experts

2010-07-15T12:22:00.000-07:00

It is important that people own a business understand what is business insurance, so they can protect their business in case of any unforeseen event happened causing hardship to the business owner and their family such as business store burned down one day, if you don't carry insurance, you would endured some hard times after that. You make sure you have insurance for anything importance, or anything that could prevent you from earning a living.

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Is Inheritance Tax Due on Life Insurance Payouts?
By Marilyn Katz

Are Life Insurance Death Benefits Tax Free?
Actually, one of the big advantages of leaving money in the form of a life insurance benefit, is the fact that the US IRS grants it a very favorable tax treatment to these proceeds. Let me start off by admitting that I am not a tax professional. That is why I consulted the IRS website to get the full story on how death benefits would impact a beneficiary when they need to fill out their tax forms.
According to IRS.gov, the website that is run by the US Internal Revenue Service, you are not liable for insurance death benefits as a taxable expense, unless you purchased that benefit for money. This is true, even if those benefits were paid out by some type of accident or health insurance plan. You may, however, be liable for any growth to that death benefit.
Life Settlement Investors Must Pay Taxes
How do you purchase these benefits for money? These days, there is a transaction called a life settlement. In these, an investor actually purchase life insurance policies as an investment. The insured person gets a cash settlement which is somewhat lower than the actual death benefit. The investor becomes the new owner and beneficiary, and they hope to profit when they finally collect the proceeds.
So this is the exception, but otherwise, the IRS declare that life insurance proceeds are a tax free benefit. Again, that is why life policies are popular ways to leave an estate. It relieves the heirs, in many cases, of having to declare the money they get on their taxes.
Proceeds Are Tax Free, But Gains Are Not
Keep in mind, that the tax advantages only apply to the actual death benefit. If any gains are made on the money, these can be taxed. It is common for life insurance benefits to be paid out over time, and for the cash in the account to build up at a specified interest or market index rate. Another example might be a cash value policy that has actually accumulated a greater cash value than the death benefit. This growth may very well be taxable. So the tax advantage is limited to the actual amount of the death benefit.
Again, if you are unclear about the distinction, it is time to consult with a qualified tax professional.
Uses For Life Insurance Policies with Tax Free Death Benefits
People have a variety of uses for these policies because they provide a simple and tax advantaged way to leave an estate.
Leave money to children or grandchildren. Because of the reduced tax liability, this may be one of the best solutions for passing an estate on to the next generation.
Leave money to a favorite charity.
Compensate some heirs because a business will be passed on to only one heir. If Grandpa is only going to pass his bakery on to one son who has trained to be a baker, he can leave money to his two daughters to compensate them. This can be a fair way to avoid family disputes.
Compensate a family if a business partner will continue to own a business. Some partnerships purchase life insurance so that the surviving partner can continue the business. Meanwhile, the other partner's family can get compensated or bought out with the proceeds from a life insurance policy.Would You Like To Shop For Life Insurance?
If you think that a policy would help you plan for the future, it may be time to compare quotes and policies that meet your needs.
Can we help you find over 50s life insurance to help you protect your estate?
We would like to make it simple and quick for you to do life insurance comparisons with our fast, free quote forms.

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Update June 26 - 2010 All About "Business Life Insurance" Information By Insurance Experts

2010-06-26T08:20:00.000-07:00

Secure Your Life and Business Through a Corporate Insurance Company

By Mark John Daniel

Life is something which has to come to an end at certain point of time and no one knows when the time may come. Sometimes due to certain misfortune death can come all of a sudden. And likewise there is a great risk in running a business. Sometimes business may suffer a great loss due to sudden death of a key employee. And it is for these reason insurance of not only life is necessary but even business and many other products are equally important in order to repay any loss.

To get full security in life you can now have a golden opportunity to insure yourself as well as your home, pet, car, even business and all that can cause danger and make you fall in some kind of difficulty. A corporate insurance company is the best option for all in order to get full insurance for yourself and your personal property. Just what you have to do is select a policy according to your choice because corporate life insurance gives you the opportunity to get insurance starting from life insurance, to all types of insurance even automobile insurance.

Travel for many of us is a hobby where one has the urge to visit beautiful places but before you travel you must feel secured from inside your heart because no one knows what will happen tomorrow so it's better to buy travel insurance. Through travel insurance you will get different kinds of benefits that can make your travel easy as well as safe. While you are travelling and your car gets damaged due to accidents on the roads then your headache of getting your car repaired will be minimized through car insurance and more over if anybody gets injured by your car then if you have car insurance, it would be beneficial on your part because car insurance can help you to come out from the troublesome situation and give you relief from any kind of stress or tensions.

Today you can get different kinds of health insurance policies which can insure your health and protect you from any kind of troublesome situation. Your health insurance policy can give you coverage for the time when you want treatment for a particular disease i.e. all kinds of financial help in order to continue your treatment in the best possible way and this can make your family members to get relief from any kind of stress or tension. So your life, health and personal property are solely yours and it is you who can protect your asset through a corporate insurance company.

Compete Infotech - an online business promotion company with highly experienced SEO professionals and marketing stuffs for sites offering seo services. We are marketing agents for http://www.corporateinsurancecompany.com, provides the information of corporate insurance and services.

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Update June 06 - 2010 All About "Business Life Insurance" Information By Insurance Experts

2010-06-06T07:32:00.000-07:00

Key Man Life Insurance - Your Business is at Risk Without It

By Lorraine Benham

Key man life insurance will really help you keep your business going if you are faced with the death of a crucial employee central to the running of your company. Most employees can be replaced but often not quickly. When you have this type of insurance you have the funds to hire part time replacement staff or to add to the package you are offering to entice a comparable person into joining your business team.

Why is it needed?

Think of this scenario: your company builds custom designed yachts. You are lucky enough to have snagged one of the top half dozen yacht designers in America as your chief designer. Then he has a completely unexpected heart attack and dies. Your company is suddenly without its biggest drawcard. If you hold a key man life policy on this employee there are a range of ways in which those funds can be used to help you look after your business interests.

One of the major consequences of losing a key employee may be a buyout by an existing partner or the need to close a business down. Having funds readily available to spend on transitioning your business from how it has operated prior to the death to what is now required, is very useful. This is a major argument in favour of key man life policies.

If a company is large, investors need to have their interests protected in the event of a key employee dying. A key man life policy is a simple and straightforward way to safeguard those interests. It works by making sure the ongoing effective operation of the business is ensured if the policy adequately covers the impact of replacing and training a replacement employee.

What are the choices about what type key man insurance you take out?

There are different types of key man life policies available. One type is the standard whole life policy in which the value of the premiums paid accrues over time. Another type is a term life policy which has cheaper premiums and covers a key employee for a specific period of time but the value of those premiums does not accrue.

Whole life key man life policies do have specific advantages. As they have an accumulating cash value they give the business a handy line of credit or an asset against which a loan can be drawn. They can also be cashed out or the value of the policy sold to the insured person when they retire.

A term key man life policy is definitely cheaper than a whole life key man life policy. This makes them perfect for smaller businesses who want coverage without a high premium. They will get necessary funds if a key man dies but if that does not occur they are not paying too high a price to cover the risk of losing a key employee.

key man life insurance is held by the business that takes it out. The business pays the premium on the policy and the business is the beneficiary of the policy. This is because it is the business which is in need of funds if it has to cope with the death of a key employee. That key employee may have held a life policy in his own right, but that is an entirely separate matter. As with all insurance, make sure you get a quote from a reputable insurance company before proceeding.

For Which Life Insurance, information that's clear and useful and for FREE QUOTES on all Life Insurance, click here www.bestlifeinsuranceavailable.com

If you have a big need for straightforward, non technical descriptions of different types of Life Insurance before getting a quote, I've collected all the information you need.. Here's what I found out about Keyman Life Insurance, Lorraine Benham

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Update May 18 - 2010 All About "Business Life Insurance" Information By Insurance Experts

2010-05-18T06:57:00.000-07:00

5 Reasons Businesses Buy Life Insurance

By Robert C Eldridge Jr

Life insurance can be used by business to accomplish a lot of different needs. I will go over some of the popular uses and why businesses buy the life insurance.

Death and Losses

After a business owner dies, there may remain massive losses to the business as the owner might not only run the business but the owner also has relationships with people that can hurt the company financial after their death.

Collateral

A permanent life insurance policy with cash value may be used as collateral for a loan. What better way to secure a loan with an insurance policy with cash value. You can walk over to your nearest bank and ask the banker how much you can get for your policy. Life insurance policies are an asset class.

Retirement Plans

Some business owners purchase insurance policies and fund their policies as a way to use the cash value for future retirement needs. These policies will grow tax deferred and will taxed until you withdrawal the funds.

Buy-out

These insurance policies can be a great way to buy a partner out when someone wants to retire or to take control and acquire a greater percentage of the business. A buy out is a great way to buy out the interest of a business when the other partner dies. The funds can then be used to usually buy out the spouse of the other owner.

Key-Man

Key man or Key Employee insurance allows a business to buy insurance on a key employee and cover the cost of losing that employee. The loss of a key person to a business can have significant financial effects on the business. The business can now protect its financial interest in those employees who are important to the business.

Click the link below in the resource box to find out more about Business Life Insurance.

Visit http://www.annuitycampus.com for more information on Business Life Insurance.

Robert holds over a decade of experience as a multiline agent in multiple states and currently serves on the membership council of the National Association of Insurance and Financial Advisors.

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Update April - 27 - 2010 All About "Business Life Insurance" Information By Insurance Experts

2010-04-27T07:57:00.000-07:00

Using Life Insurance in Business Succession Planning

By Julius Giarmarco

Life insurance can play an important role in a business succession plan. Following are some of the common ways in which life insurance can be integrated with many of the tools, techniques, and strategies commonly used in business succession planning.

Estate Liquidity. Some business owners will wait until death to transfer all or most of their business interests to one or more of their children. If the business owner has a taxable estate, life insurance can provide the children receiving the business the cash necessary for them to pay estate taxes. Using life insurance (owned by an irrevocable trust) to pay estate taxes is particularly useful to business owners because business interests cannot be readily liquidated. Life insurance is also a much easier (and less expensive) alternative to deferring estate taxes under IRC Section 6166. The children receiving the business may also need life insurance to pay estate taxes at their deaths. Typically, the insurance policy will be owned by an irrevocable life insurance trust so that the beneficiaries will receive the death proceeds both income and estate-tax free.

Estate Equalization. A business owner can use life insurance to provide those children who are not involved in the business with equitable treatment. Leaving the business to the active children and life insurance (owned by an irrevocable trust) to the inactive children equalizes the inheritances among all of the children. It also avoids the need for the active children to purchase the interests of the inactive children - perhaps at a time when the business may be unable to afford it. Depending on the particular facts and circumstances, the insurance may be owned by an irrevocable trust for the benefit of the inactive children, and the insured(s) may be the business owner or the business owner and his spouse.

Buy-Sell Agreements. A properly designed buy-sell agreement can guarantee a market and fair price for a deceased, disabled or withdrawing owner's business interest; ensure control over the business by the surviving or remaining owners; and set the value of the business interest for estate-tax purposes. Life insurance is the best way to provide the cash necessary for the business or the surviving owners to purchase a deceased owner's interest. In many instances, the cash surrender value in a life insurance policy can also be used tax free (by surrendering to basis and borrowing the excess) to help pay for a lifetime purchase of a business owner's interest.

Nonqualified Deferred Compensation Plans. A nonqualified deferred compensation ("NQDC") plan can be used by a small business to provide members of the senior generation with death, disability, and/or retirement benefits. An NQDC plan may be particularly useful in those situations where the senior members have transitioned the business to the junior members and are no longer receiving any compensation from the business. An NQDC plan is also useful to ensure that key employees remain with the business during the transition period - a so-called golden handcuff. Because life insurance offers tax-deferred cash value growth and tax-free death benefits, it is the most popular vehicle for "informally" funding NQDC plan liabilities.

Key Man Insurance. Many family businesses depend on nonfamily employees for the company's continued success. To guard against financial loss due to the absence of an indispensable key employee, many companies take out key person life insurance.

Section 303 Redemptions. IRC Section 303 allows an estate a one-time opportunity to remove cash from a corporation (equal to the amount of estate taxes and administrative expenses), at little or no tax cost, through a partial redemption of stock. To ensure that the corporation has sufficient funds with which to accomplish the Section 303 redemption, the corporation can purchase a life insurance policy on the shareholder's life.

Hedge Strategy. Life insurance can also be used to provide a "hedge" against the business owner's premature death in connection with a grantor retained annuity trust. For example, if the business owner established a GRAT and died before the end of the set term, the life insurance could be used to pay the estate taxes on the GRAT assets that would be included in the business owner's estate. In addition, if a sale with a private annuity is used, life insurance could provide funds for the business owner's spouse (and/or other family members) since the annuity payments would terminate on the business owner's death. Similarly, life insurance could provide funds for the business owner's spouse and other family members should the business owner die prematurely after using a self-canceling installment note to sell the business interest. In all of these situations, it is advisable to have the life insurance owned by an irrevocable trust so that the insurance proceeds will escape estate taxes.

Family Bank. When the decision is made to leave the business to both active and inactive children, it is usually advisable to leave the active children with voting interests and the inactive children with nonvoting interests in the business. In addition, put and call options can be given. Generally, a put option given to the inactive children allows them to require the active children (or the business itself) to purchase all or a portion of their interest in the business at a set price and terms. Without a put option, there may be no practical way for an inactive child to benefit from owning the business interest unless and until the business is sold. Conversely, a call option given to the active children (or the business itself) allows them to purchase the business interests of the inactive children upon a set price and terms. Without a call option, there may be no effective way for the active children to avoid the potential conflicts that can occur between the active children who are receiving salaries and bonuses, and the inactive children who are not. By having the active children own life insurance on the business owner's life, a "bank" is created to provide the funds to satisfy any such puts and calls. Typically, the policy will be owned outside of the business entity, such as in a trust for the benefit of the active children or by a limited liability company owned by the active children.

THIS ARTICLE MAY NOT BE USED FOR PENALTY PROTECTION. THE MATERIAL IS BASED UPON GENERAL TAX RULES AND FOR INFORMATION PURPOSES ONLY. IT IS NOT INTENDED AS LEGAL OR TAX ADVICE AND TAXPAYERS SHOULD CONSULT THEIR OWN LEGAL AND TAX ADVISORS AS TO THEIR SPECIFIC SITUATION.

For more articles on estate and business succession planning, please visit the author's website and click on "Advisor Resources".

Julius Giarmarco, J.D., LL.M, is an estate planning attorney and chairs the Trusts and Estates Practice Group of Giarmarco, Mullins & Horton, P.C., in Troy, Michigan.

http://www.disinherit-irs.com

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Update April - 02 - 2010 All About "Business Life Insurance" Information By Insurance Experts

2010-04-02T06:32:00.000-07:00

Using Life Insurance in Business Succession Planning

By David Sayers

When you started your business, all that you initially considered was how to succeed and keep from failing. The biggest concern was failure, not in how to ensure that the business survived after you passed on. However, now that your business is successful, you want to make sure that either the business continues to survive, or at the very least, that your heirs are fairly compensated by the partners when they take over the business.

In the situation where the business has two or more partners, the partnership or shareholder agreement will typically have provisions in it where the other partner(s) will purchase the shares of the deceased partner upon their death. That way, the same core group can continue to control the company. Unfortunately, when the unthinkable event occurs, rarely will you have the available cash to buy out the partners shares. This would require you to take out additional debt, and this adds more risk to your financial position. The company probably doesn't have the necessary cash reserves to buy out their shares either. This type of situation can throw the company into financial turmoil at the very least, or possibly even into bankruptcy.

One way that you can avoid this financial nightmare is to purchase term life insurance on each of the partners, and the surviving company owners will be named as the beneficiaries. This gives the other owners the necessary cash to be able to purchase the deceased partner's share. This keeps the company stable, and it allows the partner's family to receive the cash right away. If your agent structures the policies correctly, the premiums on the policies may also be tax deductible. Insurance proceeds are also tax free. From a taxation perspective, this type of arrangement can allow you to use a small tax deductable expense in order to later use a large tax free sum of money to finance this transaction.

Another thing to consider is key man insurance. We always make sure that we have the proper amount of liability coverage, as well as coverage from loss or damage of the business property. However, we often forget to get insurance coverage on our most important assets: our key employees and owners. If one of your key employees or owners were to suddenly die, your business could be negatively impacted. You may also lose a lot of your expected income, and you will commonly incur a considerable amount of expenses while recruiting, hiring, and training an adequate replacement.

Using key man insurance will not replace the work that they did, but the proceeds will provide funds for the following: keeping the business running, offsetting the expected loss in revenue, and finding and training a new person to take over their role.

Additionally, many times when a business tries to get a large business loan, the bank will actually verify that the company has key man life insurance in place before they issue the loan. This protects the bank from loss by ensuring that the death of one of the main people will not cause the failure of the business.

By taking these steps, you can ensure the long term survival of your company, as well as the ability for the firm that you build to outlive you. Many companies can provide you with quotes on term life insurance and key man insurance.

Multiple companies can offer you quotes on a return of premium life insurance policies.

Article Source: http://EzineArticles.com/?expert=David_Sayers

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Update Mar. 12 - 2010 All About "Business Life Insurance" Information By Insurance Experts

2010-03-12T05:44:00.000-08:00

Key Man Life Insurance and Exactly Why You Need It

By Frank Rodriguez

Almost anyone who is involved in business has heard of key man life insurance. But, they may find themselves unsure of what it is and why they need it. Some people are just not aware of how important it is to the very survival of their company. They may never even have considered the loss that could be associated with the death of key individuals.

Most of these coverages function similarly to term life insurance policies. with many types of life insurance policies that are utilized. The benefits, however, go to the business that pays the premiums, instead of a family member. This can help cover problems that arise if the covered person dies suddenly and causes losses to the company.

How much coverage is needed really depends on the importance of the person to business operations. The proper amount must be able to account for any losses that losing them could cause the company itself. You do not want to awake on day to discover that you have to go out of business, because you lost someone your company desperately relied upon.

That said, there are several factors that you have to think of, before buying one of these insurance policies. It is never easy to replace any key person in any business. Finding a permanent replacement could be a very difficult and lengthy process. This could mean you have to cover both the associated expenses and salaries. If they did not have a certain level of expertise, they would not have been in such an important position.

The benefits from these policies would be used to pay off large debts that the business had. Some could also be used to prevent the outside sale of shares that a particular person may have owned. Thus, there are quite a few essential ways that the pay-out can be of great benefit.

You could also find yourself being required to have such coverage, before some places will consider doing business with you. No one wants to put their money into something and find out that they do not have some sort of protection. Both lenders and other investors may require you to have such insurance coverage.

It is easy to find places that offer these insurance plans. They will do a thorough analysis of your key individuals and their importance in respect to your businesses day to day operations. They look at all the details and can properly help you figure out the amount of coverage you will need for each key player. Just like when you look for auto insurance, you can compare various prices and policy terms.

If you realize why you need it and just how it works, you understand why you need key man life insurance. If you do not have it, you may find yourself out of business, when you lose a vital employee. Operations can continue as usual, however, if you have proper coverage. The pay out can be used to alleviate all the expenses associated with having to hire someone new to fill their shoes. Anyone who has ever been faced with such a problem has never regretted having one of these policies.

You can learn more about key man life insurance by visiting the website. You will find many types of life insurance policies covered and evaluated.

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Update Feb. 19 - 2010 All About "Business Life Insurance" Information By Insurance Experts

2010-02-19T04:12:00.000-08:00

Term Life Insurance - A Safeguard for Small Business Owners

By Carrie Reeder

Term life insurance can offer protection for a small business and its owners in surprising ways. If you own a small business, you probably pay property and liability insurance, and are protected against fire, theft, flood and other disasters. But what would happen if you or one of your key employees was suddenly unable to work due to disability - or death? If something happens to you or one of your partners, what happens to your business? Who will pay outstanding business loans and other obligations?

That's where term life insurance comes in.

As your company grows, there are very likely to be one or two key people without whom you'd find it difficult to function. Besides you, there may be an accountant who understands the books inside and out, or the sales manager who drums up most of your sales. By taking out a term life insurance policy on each of those people, you can insure your company against the losses it would inevitably face if one of them were to become unable to work because of death or disability.

Why term life insurance? Especially for a young company, the lower premiums and limited term of coverage make more sense. As the company grows and becomes more stable and successful, a term life insurance policy can often be converted to a whole life key person policy - a life insurance policy that is specifically designed to cover the loss of a key person in an organization.

A term life insurance policy can also be used to cover partners in a business who agree to a buy-sell arrangement. In this case, if one partner dies, the death benefit is used as a 'buyout' to purchase his half of the company from the family. That way, the family of the deceased partner isn't stuck with a business in which they have no interest, and the surviving partner isn't forced into accepting the family as a partner.

Sometimes term life insurance isn't the best option. A whole life policy, for instance, allows you to use your investment in the policy to finance and fund projects, can help provide the basis for a retirement plan, or provide a cushion for the business to borrow against for expansion.

Whether you choose whole life or term insurance, though, key person insurance is a protection that your company shouldn't be without.

To view our list of recommended Life Insurance Companies, visit this page:
Recommended Life Insurance Companies. [http://www.ezerk.com/articulos.php?category=52]

Carrie Reeder is the owner of eZerk, an informational website with articles and the latest news about various topics.

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Update Jan. 30 - 2010 All About "Business Life Insurance" Information By Insurance Experts

2010-01-30T05:17:00.000-08:00

Business Life Insurance 12 - Advantages and Disadvantages of Common and Preferred Share Holders

By Kyle J Norton

As we mentioned in the previous article, we know that corporations generally are started by it's original shareholders who provide the start-up cash or assets in exchange for their shares. The corporation may eventually be owned by a large number of shareholders. In this article, we will discuss the structures of corporation shares and types of shares that corporation can issue. There are 2 types of corporation shares: common shares and preferred shares. These shareholders have certain rights:

1. Common share holders
a) Advantage
* right to share in growth of earnings and assets.
*right to sell shares.
* right to vote on Board of Directors and certain issues.
* right to attend company meetings and examine the books.
* right to annual report.
* receive a tax credit on Canadian corporate share dividends.

b) Disadvantage
* last to receive a portion of assets on wind-up of a company.
*dividends are only paid when declared and are related to amount of net earnings.
*dividends are paid after bond interest and preferred share dividends.

2. Prefer share holders
a) Advantage
* dividends are paid before common shareholders but after bond interest
* bonds holders come before preferred shares at the wind-up of the company.

b) Disadvantage
* Less indication of company ownership
* Corporation dividends are usually fixed by the share certificate and affected by the profitability of the company and the intent of the Board of Directors.

I hope this information will help you understand more of the right of corporation shareholders. If you need more information, please visit my home page at:

Kyle J. Norton
http://lifeanddisabitityinsuranceunderwriter.blogspot.com/
http://businessinsurance12.blogspot.com/
All rights reserved. Any reproducing of this article must have all the links intact.
I have been studying natural remedies for disease prevention for over 20 years and working as a financial consultant since 1990

Article Source: http://EzineArticles.com/?expert=Kyle_J_Norton

Life Insurance - How Small Businesses Can Cope

By Chimerenka Odimba

Many owners of small businesses want to get life insurance policies for their small staff as a way of encouraging them to be more committed to their job. This is a very good idea and should be encouraged. However, due to the hassles they ave to go through to get small business life insurance policies, many of these owners tend to let this idea go. What do we do about this?

The first thing is to find an easier way of doing this.

The first thing as with other types of policies is understanding the policy and then taking time to shop for the right insurer with the right policy for you.

If you have the time - which you may not, get all the information you can get on this policy by talking to as many agent as you can. You can also visit online quote comparison sites to see what they can offer you. Believe me, if you give it time, there are tremendous resource to help you sort through the maze out there.

For the small business owner who doesn't have the time, hire a broker to walk you through the process. Even with the broker, your eyes should still be open to understand what's going on. I personally do not like doing anything until I fully understand it. I guess in these days of fast guys, one can't be too carefully.

Be sure that whatever insurer you eventually settle with has a high rating. Be sure that you achieve your aim of doing good by your employees by getting a life coverage that is both adequate and affordable from an insurer that would be there when you need them.

if you've been discouraged before, don't be. Simply get up (for you to be reading this, you obviously have) and beging shopping for that life insurance policy that would work best for your small business.

How do I start my quotes comparison? Here are two great sites to start your quotes comparison. Life Insurance Quotes! Insurance Quotes! Chimerenka Odimba is the publisher Several finance based sites.

Article Source: http://EzineArticles.com/?expert=Chimerenka_Odimba

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Update Jan. 11 - 2010 All About "Business Life Insurance" Information By Insurance Experts

2010-01-11T04:30:00.000-08:00

Low Cost Term Life Insurance - The Most Used Low Cost Policies

By Donald Lusan

We all want to buy low cost term life insurance. It is just the wise thing to do. I was recently having a casual conversation with one of my neighbors about life insurance and was surprised to see the amount of premiums he was paying for term insurance.

I did some research for him and found the exact type of policy that he had for about half of the premium he was paying. This policy was from one of the better known life insurance giants...a company over 100 years old.

You can find low cost term life insurance from a reputable life company if you take the time to do the research. Look for the carriers that are rated A+ or better by the A.M Best company. A.M. Best does the research, that is their function.

The most popular term life policies are the 10 year term policy, the 15 year term policy, the 20 year term policy, the 25 year term policy and the 30 year term policy. Let us take a look at each and see how you could benefit from one or more of these low cost term life insurance policies.

10 Yr Term Life Insurance

10 yr term has a very low premium cost per $1000 of death benefit. If you need a policy to protect your loved ones for a short period of time then this may be the right policy for you. Let us say your youngest child is 15 years old and you expect that this child will graduate college by age 25 all you need to do is to calculate the amount of income you will need each month for the next 10 years and buy a policy sufficient to provide this income. The death benefit remains level for the entire 10 year period. It never decreases.

15 Yr Term Life Insurance

The 15 yr term plan can also be considered a low cost term insurance policy. It is usually used in a similar manner to the 10 year term but for a longer period. If your youngest child is age 10 then you would need a 15 year term policy to do the job of protecting your dependent children. The death benefit remains level for the duration and so does the premium.

20 Yr Term Life Insurance

Let us take a little time to look at the way to use the 20 yr term policy. As it is a term policy the premiums are quite low. This policy is probably the most exciting of all term policies. The reason is because it is usually bought at an exciting time in your life. You just got married or are about to. You logical thing to do is to buy a 20 year policy to protect your adorable spouse in the event of your death.

You and your spouse have an addition to the family so you each buy a 20 yr term insurance to protect your newborn child.

You start a business, whether it be a sole proprietorship, a partnership, or a corporation you know you need to buy some life insurance.

This policy has a level death benefit as well as a level premium for the duration.

25 yr term life insurance

You may say 25 years is too far to look. Well, let us look at the first situation we discussed. You expect your children to graduate college by age 25. If you are newlywed you likely don't have any children as yet or if you have a new addition to the family the 25 year term policy will work just fine for you. Premiums are level and so is the death benefit.

30 Yr Term Life Insurance

The 30 year term life policy is for people who look even further ahead. This is a low cost insurance policy that can protect your family right up until you retire and get a pension, that is if you are age 35 or older at the time of purchase. This policy works just like the other policies.

When in the market for low cost term life insurance you should keep in mind that the longer the duration of the term policy the higher the cost. The 10 year policy will cost less in premiums than the 15 year term and so on.

For more details go to: http://www.lifeinsurancehub.net/lifeinsurance-1.html
For more than 40 years Donald has been known for his extensive knowledge of the life insurance business. He has represented some of the largest and most admired life insurance companies in the United States as well as Canada. His advice is invaluable.
Donald's website is: LifeInsuranceHub

Article Source: http://EzineArticles.com/?expert=Donald_Lusan

Financial Crisis Has Spike Life Insurance Buying

By Julie Viola

Every time there is an economic crisis, it is bound to have huge impact on all facets of our lives. From your grocery food items, mortgages, gas and fuel to life insurance have so many effects on how we do things. Life insurance companies may be having a good time right now as many people are looking for protection and security. Insurers are really benefiting from the financial crisis. The financial crisis has brought a spike on life insurance buying as more people realize that they need to be protected when there is economic turmoil and recession.

Life insurers are benefiting from form the financial crisis with a 9.5 percent increase in total premiums over the past year to September 30. This is according to The Nation Business Review article written by Fiona Robertson. According to the statistics from the Investment Savings and insurance Association, total premiums for in force life insurance policies increase to 1.512 billion dollars compared with 1.381 billion over that time. New policies sales has rose particularly strongly in the September quarter with premiums for new individual risk policies up to 21 percent to 51.78 million dollars.

It is very true that many people are flocking to get life insurance to protect their business and loves. One of the main reason for this is the many people who lost their jobs and do not have life insurance outside of their group insurance. I can imagine a boom for life insurance companies especially in the US. With people losing their jobs from almost sector of society, you can simply do the math and you can see that so many jobless people now are those that have been laid off because of rough economic times. To some people in the industry, they do not agree on the timing to get you insured.

While most people would always consider insuring as part of their financial road map, this is not the right time to get insured. But you cannot get people not to worry about what is going to happen since there is more pressure for everyone to get some form of protection and security. Protecting your family and business is foremost in the minds of most people because of the disastrous effects of inflation and deflation. Economic hard times mean a lot pressure from your work to perform and produce more and in the process stressing out yourself. Being too stressful can have so many health risks that can render you incapable of working and worst die of heart attack or stroke.

The rush to get financial protection and security at times like this has to do a lot with the health issues of many people. Many people are getting sick or stress at work and some eventually take short term leave or long term leave of absence because of medical reasons. When people are push to the limit and with so many problems with your mortgages, credit card debts and loans plus your regular bill payments, it takes its toll on anyone. When all these factors are happening at once, people run for cover so to speak. And the best that you can do is to protect and secure your business, family and love ones.

With all the health and other issues that mentioned that affect every individual during financial crisis, one should not wonder why people are flocking to buy life insurance from amongst the many life insurance companies. It has indeed spike the rate of buying policy coverage in the last little while since the economic downturn started. Whether some quarters are advising people that this is not the best time to get insured, you cannot prevent people who may be panicking over the situation. The statistical numbers do not lie and it really showed the spike or surge in people getting policy coverage.

If You Want To Buy Life Insurance During Financial Crisis and Know More About Life Insurance Companies, Go To JGVFinance.com For More Guide and Information In All Your Fnancial Isssues and Concerns That Matters To You And Your Family.

Article Source: http://EzineArticles.com/?expert=Julie_Viola

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Update Dec. 24 - 2009 All About "Business Life Insurance" Information By Insurance Experts

2009-12-24T06:04:00.000-08:00

The Value of Insurance For Business Security

By Sarah Martin

Insurance is often undervalued, frequently because people have a narrow mind when it comes to the insurance business as a whole. However, insurance helps to give security to business dealings. Here is a look at how insurance can give your business security.

Insurance is a swap:

All types of insurance do one thing - they exchange a small, certain payment for a large, uncertain loss. Basically, this means that you pay a small fee and fixed intervals (your premium), and the insurance company will take the risk should any losses ever occur.

Take, for instance, a flood. Floods are often destroying business property and inventory, but it is impossible to know when one will, if ever occur. If you were able to tell when a flood would occur, you wouldn't need homeowner insurance. But because you can't, taking out a flood insurance policy can help you to replace the things that you lose when there is a flood.

Group statistics can be calculated:

While you cannot tell what your chances of a flood, fire, or other disaster will be, your business group as a whole has set statistics. For instance, if you own a bakery, your risk of having a fire destroy your business is higher than the risk of a fire taking down an office building. Knowing that, you could decide that as a bakery owner, your risk of having a fire is higher, and you therefore need more insurance. If you are an office owner, you could decide that your risks are lower and that you need less insurance. Every business and every individual needs certainty, and insurance can help to provide certainty in an uncertain world.

All insurances are similar:

Fire insurance is not terribly different from flood insurance, and flood insurance is not any different than life insurance. To a certain extent, all insurances are the same. If you work with life insurance, then you know that approximately 3.8% of people die before they are 25. This means that another 96.2% don't, but you have no way of knowing which of the two groups you will be in. All you can do is calculate your personal risk. The higher your risk, the higher your premium will be.

This is true of all types of insurance, including home owner's insurance. Property owners never know how good their title is. A merchant doesn't know how much he will lose on a given debtor. However, when you look at a large enough group, you can get an idea of what your individual risk is. Everything you do in business has a certain risk to it. On your own, you cannot determine what the risk is, but as a member of a business group, you know what the statistics are for that group.

What insurance does for your business:

Business has risk. There is the risk of losing property, losing life or health of employees, or losing money, among others. What insurance does is give you some guarantee against these losses. By knowing what your risk factor is, and insuring it appropriately, you will know that you have what you need sure an incident ever occur.

Sarah Martin is a freelance marketing writer based out of San Diego, CA. She specializes in business, finance, and insurance. For a free home owner's insurance quote, please visit http://cheap-insurance-rates.com/

Article Source: http://EzineArticles.com/?expert=Sarah_Martin

Life Insurance - Pick the Right Type For Yourself, Your Family, and Your Business

By Marilyn Katz

You purchase either permanent or term life insurance. Permanent life insurance will cover you for your whole life with premiums calculated to cover the cost of insurance until a very advanced age, typically 100. If you live past the advanced age the policy is calculated for, you will no longer need to pay premiums, and in some cases, may receive your death benefit as a birthday present! If you pay premiums for your whole life, then this is called whole life or straight life insurance.

Even though the premiums are calculated to provide you insurance over a long life, you may have a policy that can be paid off in a shorter times. Common pay off periods are ten or twenty years. In order to receive the full tax benefits of insurance, as in a tax free death benefit, the payoff period must be longer than seven years. If the payoff period is shorter, the policy is called a Modified Endowment Contract (MEC).

An example of a MEC is single payment whole life. These types of life insurance are still popular products, especially seniors who want to transfer wealth to their heirs. For instance, a twenty thousand dollar contribution may provide an immediate death benefit of thirty-five thousand dollars. In addition, these types of policies usually pay interest on the cash value, and they may even be indexed to equities like the stock market. Since they have an immediate cash value, money will grow right away. The longer the insured person lives, the greater the value of the policy. The death benefit will be taxable under current federal law, but the growth is tax deferred, and they provide an immediate death benefit.

Another type of permanent insurance is called Universal Life. Universal life insurance separates the cost of insurance from the cash value, and many products are indexed to security indexes like the S&P 500, allowing for greater returns. Most policies guarantee that the return will never be negative, and some provide a no-lapse guarantee. This means that as long as you pay an agreed upon minimum payment, the insurance company will not lapse your policy because the returns are not large enough to cover the cost of insurance.

On the upside, gains in the value of your insurance policy can increase your death benefit, increase the cash value, and generally provide you with ways to access the money in your policy while you a alive. As you may have guessed, Universal Life Insurance provides life insurance, as well as an investment or savings vehicle. You may assume more risk with Universal Life than with Whole Life, but can be rewarded with greater returns.

Of course the last type of insurance is term insurance. This is usually considered pure insurance because you are generally only paying the cost of insurance without ever receiving any cash value. That is why term life insurance has the lowest premium cost. The insurance company only accepts the risk of insuring your life for a specified period of time. They are betting you will live for a period of ten, twenty, or thirty years. You are purchasing term life insurance to make sure that your family or business will survive just in case you do not.

Of course, the life insurance world is not this simple. You can add a term rider to universal life insurance to provide extra protection during those years when you need more coverage, You may also add return of premium riders to term policies so you will get premiums refunded when the policy ends. Before you purchase a long term contract like life insurance, you should always consult with professionals and do your own homework.

M Katz has helped many families and businesses choose life insurance protection. The key is to analyze an individual's needs, educate the consumer, and then allow them to select a policy that will serve their needs. M Katz believes that insurance shopping works out best when it is a consumer directed process!

Let us help you find the cost of life insurance with our fast, safe, and free online quote forms!

Best Insurance Rates

Article Source: http://EzineArticles.com/?expert=Marilyn_Katz

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Update Dec. 04 - 2009 All About "Business Life Insurance" Information By Insurance Experts

2009-12-04T03:19:00.000-08:00

20 Year Term Life Insurance - So Many Uses For This Policy

By Donald Lusan

The 20 year term life insurance policy can be effectively used in oh so many situations. We will look at some of them but first let us define what this policy is all about. 20 year term insurance has a level death benefit for the entire 20 year period. This death benefit can be paid in one lump sum or in income form. The premiums, more often than not, are also level for the duration. Sometimes a life insurance carrier may elect to allow applicants to start the policy at a lower initial rate then increase it at a specific predetermined date in the future, for example, at the 5 year point or 10 year point. How could you effectively put a 20 year term life insurance policy to use?

If you are married and you have children the youngest of which, for example, is 5 years old this policy could cover all your immediate life coverage needs. This policy can determine that your present income will continue after your death. It could be used to provide planned sums of money that would be used to pay college costs for your children even if you are not around to share the event with them.

A portion of the proceeds of your 20 year term policy could provide funds to pay final expenses and burial costs.

If you are single and have no dependents this policy can be used to put you six feet under without any financial burden to your relatives. Why would you use this policy? The answer is simple. Although your need for life insurance is limited today, over the next 10 or 20 years you likely will have a need. As the price is so very low at the younger ages it may be wise to buy the policy now and when the time comes that you really need to own insurance you will already have it. You should also keep in mind that as you get older there is a possibility that you could develop some illness that may cause the company to charge you extra or to disqualify from obtaining a policy.

If you are single and have children your need will be much like a married person with dependents.

We tend more often than not to give much thought to the needs of the children in the event of the death of a parent. That is great but what of the needs of the surviving spouse. If the children are grown and on their own we still have each other. What if one of us should die. What of the surviving spouse. Is his or her income sufficient to live. Is the mortgage paid off or will the surviving spouse have to continue monthly payments. Think on these things. The 20 year term policy could provide cash or income for your surviving spouse which would be used to take care of these things.

Many business people find it a good decision to buy 20 year term life insurance. Business people tend to plan 1 year ahead, 5 years ahead, 10 years ahead and 20 years ahead. They may use life insurance to fund buy sell agreements if a partner or shareholder should die. They could buy out the shares from the heirs of the deceases partner or shareholder. Both surviving family and surviving shareholders should be pleased in this case. This policy is often used for key employee insurance. The death of a key person can devastate a business while they go about replacing this valued employee. The 20 year policy is a favorite for these business situations.

As you can see 20 Year Term Life Insurance is very often a good choice.

For more than 40 years Donald has been known for his extensive knowledge of the life insurance business. He has represented some of the largest and most admired life insurance companies in the United States as well as Canada. His advice is invaluable.

Donald's website is: http://www.lifeinsurancehub.net

Article Source: http://EzineArticles.com/?expert=Donald_Lusan

Small Business Life Insurance Needs

By Donald Lusan

Have You Given Any Thought To Small Business Life Insurance?

What Type Of Business Do You Own?

Is your business a Sole Proprietorship?

Are you part of a business Partnership?

Is your business an S Corporation?

What about a C Corporation? Is this how you incorporated?

Have you taken advantage of the new Limited Liability Company laws?

How about Key Employees? Do you have any employees that you can categorize them as Key Employees?

Small business life insurance as it applies to each type of business is different in many ways but there are also many similar features as well. What we are discussing here is not group life insurance but more specifically life insurance as it applies to the owners of each business and life insurance for the key employees. Let us take a look at each type of business and how life insurance could go a long way in protecting the business itself as well as the heirs of a deceased business owner.

The Sole Proprietorship.

Because the owner of a sole proprietorship and the business itself is considered one and the same one may think that the need for small business life insurance is limited. Nothing could be further from the truth. We put in a lot of time and effort building a business that has to be dissolved at our death. We do want to have this business transferred to a member of the family when we die. How can this be done?

The estate of the sole proprietor can sell the assets of the business upon his or her death. A small business life insurance policy can be bought during the lifetime of the owner the proceeds of which would be used to buy the business. A buy sell agreement, which would be binding, would determine the terms and the amount to be paid for the business.

Let us assume the proprietor is married and has a son or daughter who is interested in taking over the business upon his death. This young person has spent a lot of time learning the intricacies of operating the business from his or her father. So dad decides he wants to transfer this business to this child upon his death. He has a buy sell agreement drawn up by an attorney that would fulfill his desires. This agreement is funded buy a small business life insurance policy specially bought for that purpose.

The proprietors wife is not particularly interested in the business but if the business owner dies before her she will still need income. The proprietor dies. The proceeds of the small business life insurance policy is used to purchase the business from the estate and the wife has full value in cash. She can use this money to purchase an annuity that would pay her an income for a certain number of years or for a lifetime. Of course this decision will depend on the amount of money we are talking about here.

The Partnership.

The use of small business life insurance in a partnership is very simple and straightforward. The ownership of this partnership is in the hands of three partners. For the sake of easy explanation let us assume that that these partners own equal shares. A buy sell agreement would be set up that would state that the partnership would buy the shares of a deceased partner from his heirs. The buy sell agreement would be binding. The heirs cannot decide they don't want to sell. The partnership would buy a small business life insurance policy on the lives of each of the partners in the amount of the value of their shares. The proceeds would be used to fund the purchase. In some cases the policies can be owned by the partners themselves. The results are the same.

The Corporations.

Small business life insurance for c corporations, s corporations are limited liability companies is very similar to that of the partnership. The corporation usually owns the policies on the lives of the principals. Upon the death of a stockholder the corporation buys the stock from the heirs of the deceased. A small business life insurance policy is the least expensive way to fund the buy sell agreement. It is recommended that the insurance is updated on a regular basis and that the buy sell agreement is reviewed and updated from time to time...as it is binding.

Key Employee Life Insurance.

What state would your business be in if a key employee died? Have you given this any thought? In my 40 years in the life insurance business I have seen many interesting situations. Some businesses had no key employee life insurance on their valuable employees...much to their detriment. Others were prepared and things continued on smoothly after the death of the key employee. It is recommended that if a business has a very valuable key employee that they buy a small business life insurance policy on the life of that employee equal to about 5 years of that employees income. Upon his or her beath the proceeds of the policy is paid to the business and used to help keep the business going while the company finds a capable replacement.

For more detail on Business Life Insurance go to: http://www.lifeinsurancehub.net

For more than 40 years Donald has been known for his extensive knowledge of the life insurance business. He has represented some of the largest and best life insurance companies in the United States as well as Canada. His advice is invaluable.

Donald's website is: http://www.lifeinsurancehub.net

Article Source: http://EzineArticles.com/?expert=Donald_Lusan

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Nov. 15. - 2009 All About "Business Life Insurance" Information By Insurance Experts

2009-11-15T08:14:00.000-08:00

Life Insurance and Your Business

By Jorge Herrera

Most of my articles are focused to personal financing, because it is where the Infinite Banking Concept offers the easiest applications and not everybody owns a business.

Although we look at interest and charges and taxes as business expenses, and we can deduct most of them as the cost to do business, we as business owners can harvest huge benefits, when we combine our normal business operations with the banking capabilities that the IBC (Infinite banking Concept) provide us.

One of the main reasons we take on a business structure is to be able to deduct many expenses and for that reason pay fewer taxes than an employee.

Everything we do is financed; no matter if we are an individual or a business, so if we have to pay interest for the use of the money, then why not pay that interest to ourselves? And business owners are notorious for not treating the business capital (money) as a business.

Business owners are much disciplined at paying the loans and using borrowed money very efficiently, but they do not pay attention at the business own money being managed efficiently so it generates profit.

Leverage is a beautiful concept, and using somebody else's money to generate profit is good business, but that implies paying interest to someone else to use their money and that makes the business operation more expensive.

What if you could capitalize and create a pool of money that you can use to finance some of the business operations, at the least, you would have an option of using your money or somebody else's money and that will put you in a position of strength.

There are many applications where using your pool of money will allow you and the business to improve efficiency and that will generate profits and cash flow. There is a lot of money that can be recaptured while leasing vehicles or equipment; financing inventory will provide a real cost that is overlooked on the sitting equity represented by that inventory.

Other uses are: It can help retaining key employees; it can ensure the continuity of a business by providing protection and buy-sell purchase options. It can be used to fund projects and provides a safety net for bad economic times like Walt Disney and J.C. Penny did.

While there are many ways you can set up a personal banking system or create a pool of money to benefit yourself and your business, depending on the particular purpose, The Infinite Banking Concept and permanent life insurance will be your best bet.

I am a practitioner and very passionate promoter of the "Infinite Banking Concept". Close to four years ago I opened my eyes and ears to the limited knowledge of money management by the use of Whole Life Insurance and when I realized how powerful and beneficial to the average American it was, I decided to open my mouth to promote it. I will use all my training and team resources to help you find the money that is already in your cash flow, to implement your personal banking system.

http://InfiniteBanking.com

http://Bankonyourcashvalue.com

Article Source: http://EzineArticles.com/?expert=Jorge_Herrera

Business Life Insurance 12 - Advantages and Disadvantages of Common and Preferred Share Holders

By Kyle J Norton

2. Prefer share holders
a) Advantage
* dividends are paid before common shareholders but after bond interest
* bonds holders come before preferred shares at the wind-up of the company.

I hope this information will help you understand more of the right of corporation shareholders. If you need more information, please visit my home page at:

Article Source: http://EzineArticles.com/?expert=Kyle_J_Norton

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Update Oct. 28 - 2009 All About "Business Life Insurance" Information By Insurance Experts

2009-10-28T09:07:00.000-07:00

How the Life Insurance Sales Lead Can Grow Your Business

By Frank Rodriguez

The Internet is the best source for finding life insurance sale leads. There are more than enough choices of where to buy them. The leads, are the consumers who are looking for affordable life insurance that will work with their budget, so they can make their payments. People want to be covered for life but they worry about the cost.

The states do not demand that we carry coverage for life and this allows people to put it off and wait for a better day to think about it. When you buy a list of leads you will not be getting these consumers on your list. You will talk to those who are concerned, and seeking a quote to make a decision.

A lead generation company has to do a lot of advertising and then they collect the data to form the demographics of the interested caller. The list should be fresh and no more than a day old. When a person ask for information that they thought they would get from the call they are ready for answers. Waiting very long to call them will cause their interest to drop or they call a different agent.

When you purchase a list you should have the information necessary to prepare for the call. You do not want to sell a policy for a large family to a single person, so offer them only what is appropriate for their income. Trying to hard to sale to those who want to buy will kill the sale. Talk to the person as one who understands they need a plan that fits their lifestyle. They will trust you because you are sensitive to their needs as you being the agent should.

Some of the best leads are still the word of mouth leads. These consumers already have a degree of trust with your product; because their friend is happy with it. Create trust with your customers since this will send you more customers and get sales. The good ole sale spill has hit the floor and can be seen coming. Try the tactics of honesty and up-front information since there is not anything to hide.

When you are looking to increase, your sales simple try a reputable company that sells leads. The list must be fresh in order to catch the consumer while their interest level is still high. The longer they wait to hear from an agent the less interested they become. When a consumer is ready to purchase Life insurance, they will find an agent willing to help them instead of waiting over 24 hours. Those that want to buy the same day will.

When you are skilled, at closing sales, you can hire someone to help with calls; and you finish the call; closing the sale. Some companies offer this service too. They will transfer the call to your phone after they have confirmed the consumer's interest.

You can understand why I say finding a life insurance sales lead is easy. This really comes down to your motivation since the consumer is waiting for an agent to call them, even while you read this article. You have available the source of leads and if you have the expertise to sale your product. Use all these attributes and you should watch your sales grow significantly. Try an insurance lead provider that has experience and the newest technology to get the volume of quality leads you need and start growing today.

If you would like more complete information on the life insurance sale lead and how it can increase your sales please visit the site today. You will find everything as it relates to the life insurance sale lead business and more.

Article Source: http://EzineArticles.com/?expert=Frank_Rodriguez

The Life Insurance Business in 1868

By Sarah Martin

The world of 1868, when the Metropolitan Life Insurance Company was born, was very different from the world we know today. There were no telephones in those days and no electric lights. The country had not yet been spanned by a transcontinental railroad. Records were kept in handwritten ledgers, and business letters were penned in longhand. The entire population of the United States was only about 37,000,000. The flag then carried 37 stars.

Canada at that time contained only 3,500,000 people. She had only one year earlier (1867) achieved Dominion status in the British Empire. The two countries, although their frontiers were expanding, were still largely rural. At the census of 1870, the American population living on farms and in country villages numbered about 30,000,000. Persons engaged in agriculture, forestry, and animal husbandry constituted half the total working population.

The War of the States, to be sure, was over, but the struggle had left in its wake a variety of national problems-- not only political but also economic and social. The Nation was still feeling most of these with full force. For instance, greenbacks were still in circulation, and specie payment was not to be resumed until 11 years later. With the emancipation of the slaves, the labor problem reached a new phase. The Government of a now united Nation was anxious to offer its citizens fields for expansion, and through the Homestead Acts and subsequent land grants made thousands of farm acres available to pioneers.

To others more enterprising, new territories offered opportunity to exploit the resources of great plains and mountains. The primary need of the country was adequate transportation facilities, which were considered a key to further economic progress. However, all signs pointed to a great expansion ahead. The actual issues of the war itself had, for the most part, been settled. The country could now go forward to the fruitful destiny which its rich natural resources and its vigorous people promised.

Industry, commerce, and finance felt the new stimulus to surge forward. The business depression which immediately followed the close of the war proved short and was succeeded by a distinct upturn. By 1868 there was in progress a business revival which was to last five years. The Metropolitan was thus launched on a rising economic tide. Immigrants in large numbers were encouraged to come to add the work of their hands to the building of the country.

They made up a new working population, which took root, for the most part, in the cities. Crossroads were becoming towns almost overnight. Towns were swiftly growing into cities. A deeper sense of permanence colored the thoughts of the American people, who began to think in terms of a future, a home, family security. The United States was rapidly coming of age.

The class of wage earners was growing rapidly, a circumstance which, as we shall see, proved to be a determining factor in the development of the Metropolitan. As inventions multiplied and factories grew, women and children were employed in greater numbers. The acceleration of industry and of urban life accentuated the economic insecurity which many felt in their new environment.

City dwellers became conscious of the hazards of long working days, child labor, and industrial accidents. Mines and railroads and machines were being developed with consequent risk to human life. Health conditions in our cities were far from good. To provide a measure of security for this increasing urban population, life insurance and private health insurance companies came into being.

The war decade of the 1860s gave opportunity for the great expansion of the life insurance and individual health insurance business. As a result, more than 100 companies were functioning by 1868. The New England Mutual and The Mutual Life Insurance Company of New York had already been in operation for 25 years.

In fact, when the Metropolitan appeared on the scene, there were already in existence organizations with such familiar names as the New York Life, the Equitable Life of New York, the Mutual Benefit of New Jersey, the John Hancock, the Aetna, and the Connecticut Mutual. By present standards none of these companies was large, yet in their day they were important economic enterprises. At the end of 1868 the largest of these, The Mutual Life of New York, had gross assets of more than $30,000,000 and insurance in force amounting to nearly $200,000,000.

Sarah Martin is a freelance marketing writer based out of San Diego, CA. She specializes in business, finance, and private health insurance. For a free individual health insurance quote, please visit http://www.cheap-insurance-rates.com/.

Article Source: http://EzineArticles.com/?expert=Sarah_Martin

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Update Oct. 09 - 2009 All About Business Life Insurance Information By Insurance Experts

2009-10-09T03:14:00.000-07:00

Business Life Insurance 15 - Option to Fund Buy-Sell Agreement
By Kyle J Norton

There are three main options or ways to fund the Buy-Sell Agreement. I'm sure you won't be surprised to find that most Buy-Sell Agreements are paid out using life insurance. In fact, the first two funding options deal with available options using life insurance:

1. The criss cross option
Under this option the life insurance is owned and paid for by the partner out of after tax income. In other words, life insurance are purchased and paid for by the partner or shareholder on each other's life and the owners are the beneficiary. This is the primary and traditional method of structuring a buy-sell agreement and for sole proprietors and partners and it is the only option available for unincorporated businesses. Under the criss cross option, policies can be co-owned and paid for by split dollar arrangements.

2. Split dollar funding option
The second option to fund buy-sell agreement is split dollar funding option that is the pre-determined agreement between employer and employee on how to fund life insurance premiums. Split dollar funding became popular to fund several important functions.

a) Key man insurance and award.
b) Employee buy-out.
c) Corporate buy-sell agreements between shareholders and used as the incentive for a business to accommodate a split dollar buy-sell agreement
i) The premium payment creates unequal contributions due to extreme differences in the ages of the partners, or employees buy out the owner.
ii) If the employee is the son or daughter of the owner, it allows the siblings and heirs to be compensated in cash for their share of the business interest.
iii) It is particularly attractive in closely held corporations due to the lower corporate tax rate. This is not available to partners where the tax advantage is considerably less advantageous.
Whole life policy containing cash values is the best choice for life insurance used for buy-sell agreements.

3. Corporate repurchase and corporate redemption method
The third funding option for buy-sell agreements is the corporate repurchase or corporate redemption method. This is used solely by corporations, who may also use the criss-cross method. The corporate repurchase or corporate redemption method may be funded in one of two ways:

a) Cross-purchase agreement:
This technique is funded by tax free dividends. It provides for corporations:
i. To own the required amount of insurance on the lives of the shareholders.
ii. To pay the premiums.
iii. To be the named beneficiaries.

b) Corporate buy-back of shares.
Premiums of insurance are paid by the corporation.

I hope this information will help. If you need more information of the above subject, please visit my home page at:

Kyle J. Norton
http://lifeanddisabitityinsuranceunderwriter.blogspot.com/
http://businessinsurance15.blogspot.com/
All rights reserved. Any reproducing of this article must have all the links intact.
I have been studying natural remedies for disease prevention for over 20 years and working as a financial consultant since 1990

Article Source: http://EzineArticles.com/?expert=Kyle_J_Norton

Top Insurance Company Secret Revealed - AIG Life Insurance Company & Others Risk All Buying Business
By Donald Yerke

As an insurance insider I will reveal why the failing of AIG Life Insurance Company was destiny, not fate. The top insurance secret reveals the practice of AIG Life Insurance risking all for financial glory. Other insurance company headquarters like AIG have commonly manipulated business risk. See why buying business is a risky financial explosion rarely succeeding.

Sure you read and saw on the news lots of reasons why AIG is a still a failing life insurance company that will never recover the financial status it once had. The liquidity crisis caused by dealing in derivatives tied to the downfall of the real estate market in the United States is not surprising. Dealing in subprime mortgages seemed a certain bet to obtain high profit returns. Lots of life insurance companies did it also. However it is now revealed that only a little over a dozen show any possible failing financial outlook.

This dirty dozen, did almost everything the same as AIG Life Insurance Company. Products were offered by agents and brokers that were equity indexed annuities. These products sold mainly by industry giants, put the annuity policies offered by other companies to shame. Before the financial bailout, the insurance and financial trade magazines were loaded with top ads revealing why their products were the best agents could ever offer their clients. All of these companies should be accused of greed. Fortunately for their financial sake, these other providers still promoted other annuities and various profitable life and health insurance products.

The Top Secret Revealed

AIG pulled out one of the most dangerous secrets in the industry. To gain insurance market share the easiest way is "buying business". In the competitive insurance market to have to have a large field force of agents selling your products to stay or become an industry leader. Companies like Metropolitan, Prudential, New York Life, and others were hard to jump ahead of with name recognition and plenty of agents. To move up, AIG Life Insurance Company each year kept trying to climb the charts to become the number one company with the most assets They enacted an old trick works that works for some insurers, and causes the financial downfall of many more.

How Buying Business Works

Almost all health and life insurance products plus non-institutional annuities are directly sold by insurance agents. The average agent has great difficulty in selling an annuity. Other financial orientated agents make their living selling annuities and investment products. AIG Life had a plan that could combine annuity and great investment. Nonetheless, the equity indexed annuity product cannot sell itself. That is when the company began the process of buying business. The purpose being to sell massive quantities of a product so you can bypass the assets of insurance companies ahead of you. You then become the top dog with other carriers chasing you.

The process involves giving clients the highest payouts on money invested, and pay selected insurance representatives the highest commissions for selling their annuity product. AIG Life decided to do a similar concept with their term insurance, as new policyholders ordinary do not die for awhile. Therefore, little money would initially be spent on paying claims. The client received the cheapest term insurance rates that were often 30% less than other major companies. The independent agents were rewarded with commissions well beyond the normal 60% to 70% range. In fact the commission varied from 80% or over 100%.

Easy sales and lots of them were racked up by the selling agents, bringing in more money than ever before. In turn, AIG was revealing gigantic increases in the amount of premiums collected. They were skyrocketing in the industry charts. Suddenly all came to a halt. The real estate mortgage crash which few experts predicted was the real crusher.

Their poor planning style on buying business was greed motivated, poorly planned, and misfortune bound.

When you offer the lowest rates, or highest investment return, plus pay the highest insurance company commission eventually lightning will strike This is the effect of buying business. AIG felt after accumulating enough business they could gradually raise rates, and have an established base of agents selling more profitable policies. AIG did not realize that agents that sell annuities and term insurance are not loyal. A better offer from a competitor and the business will then stop to flow. There they were caught in a death trap set to occur. If the liquidity crisis did not take place first, eventually all the cheap term policies would have turned into expensive death claims forcing them into company receivership.

The consequences of buying business could take many years to occur. By then their fat salaries and astronomical bonuses could have cushioned them into a guaranteed retirement plan. The insurance company like other companies that engaged in buying business were doomed to fail. The failure was no secret to me, as I have seen so many cases of buying business eventually causing an health, annuity, or life insurance company go into state receivership.

The logic of governmental & taxpayer bailout is far from a guaranteed solution. On that subject I will leave it to anyone who passed Economics 101 to explain.

Well published author, Don Yerke likes to concentrate on what you don't know or what no one else dares to print. Tell it like it is.
Watch for his new paperback book debuting on Amazon this summer. It is loaded with great insurance marketing, brokerage, sales, and recruiting information.
Come and get your FREE "Think and Grow Rich" Ebook by Napoleon Hill instantly.

The website address is http://www.agentsinsurancemarketing.com

Save more than 60% Visit the website to get a package of Ebooks at under $1.99 each.

Article Source: http://EzineArticles.com/?expert=Donald_Yerke

Life Insurance - Pick the Right Type For Yourself, Your Family, and Your Business
By Marilyn Katz

Let us help you find the cost of life insurance with our fast, safe, and free online quote forms!

Best Insurance Rates

Article Source: http://EzineArticles.com/?expert=Marilyn_Katz

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Update Augaust 30 2009 All About Business Life Insurance Information By Insurance Experts

2009-08-30T05:23:00.000-07:00

What Business Insurance Do I Need?
By Billings Farnsworth

Insurance is a part of life. We have health, homeowners, automobile, life, and even business insurance. Business insurance, of course, is only used by entrepreneurs and businesses. Despite this, however, it is just as important as the many other types we use today.

Insurance is a form of protection against financial blows that would otherwise be back breaking. Most people have to cover only themselves, but a business needs to make sure all parts of the establishment have the proper coverage. The first thing that needs to be considered is liability. Where could an accident occur that could hurt the company? Are there employees driving company cars, is there anything on the property that might damage something else? Figure out where the liability may lie and buy a policy that will thoroughly cover it.

After making sure you have liability insurance, any other coverage you choose is truly preference, but it wouldn't hurt to have. This added insurance will vary depending on the type of business you run. For example, the bank of New York will want New York Business Insurance to cover the potential loss of any money in the event of a theft. On the other hand the CEO of a large company may want to get a business life insurance policy on himself and/or those directly beneath him on the success ladder. The company is usually the recipient of these funds in the event of a death. Then, of course, there's the typical health insurance given to employees through the business. This is a form of business insurance as well.

You may choose to start with liability only and work your way up or you may choose the full spectrum and give full or partial coverage to yourself and your employees. Again, it is preference, but extra coverage never hurt anybody.

Community Brokerage (http://www.01insurance.com/new-york-business-insurance/) offers information on New York Business Insurance. Billings Farnsworth is a freelance writer.

Article Source: http://EzineArticles.com/?expert=Billings_Farnsworth

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Update Augaust 11 2009 All About Business Life Insurance Information By Insurance Experts

2009-08-11T00:23:00.000-07:00

Why People Buy Life Insurance
By Donald Lusan

Have you ever considered why people buy life insurance? I know the salesmen and the creators of the policies themselves have thought about it because if they didn't these policies simply wouldn't sell. Probably the greatest life insurance salesman ever once said that "selling is 98% understanding human beings and 2% product knowledge". Another question that is worth exploring is why do some people not own any life insurance at all. Why would you buy life insurance?

Love of FamilyMore often than not the reason people buy life insurance is because they care about what their loved ones will experience if they should die suddenly. This caring can be expressed in different ways. The Hawaiian people, I am told, have such a deep passion for the well being of their families that they will go to extreme limits to protect them. They tend to buy lots of life insurance as a result. There are others who buy life insurance through a deep sense of responsibility. They love their families but they are driven more by the fact that the family relies on them so they have to live up to what is expected of them.
Tax AdvantagesSome people, especially the business minded, buy life insurance for the tax advantages the purchase provides. The death benefit of the policy is paid free of Federal Income Taxes more often than not. If the policy is part of your estate the proceeds are taxable. If you own cash value life insurance the cash value and dividends accumulate tax free. When you cash in the policy you will need to pay the taxes on the interest earned. The reason this is advantage is that these policies are usually cashed in round and about retirement time. Your income is likely to be less than when you were working so you would be in a lower tax bracket.
Tax SheltersThe most highly paid life insurance salesmen are the ones who know the tax laws inside out. Here is how they do it. They are usually qualified Financial Planners. Some are Attorneys or Accountants. What they do is to show well off people legal ways of sheltering their income from Income Taxes. They save them a lot of money. As a result these clients think nothing of putting some of the money in a life insurance policy that they need anyway. They need to buy life insurance to protect their families. A large portion of an estate can easily go to pay estate taxes. These people buy life insurance policies sufficient to pay the taxes upon death.

The reasons we buy life insurance may vastly differ but everyone needs to buy some sort of a policy...if it is even just to take care of final expenses.

Here are some things that everyone should consider:

http://www.lifeinsurancehub.net/estateplanning.html

And for the person who owns a business:

http://www.lifeinsurancehub.net/businesslifeinsurance.html

Donald's website is: http://www.lifeinsurancehub.net

Article Source: http://EzineArticles.com/?expert=Donald_Lusan

The Recognition of a Life Insurance Policy Holder
By Graham McKenzie

When a life insurance policy is purchased, the widow/widower is protected when a fatality is recorded. 90% of a population decided on purchasing a policy.

Those business minded individuals may make insurance claims in correlation with cooperations along with other members. These methods are traditionally described as covering the security of the business in the time of an associate losing life. There are limits on whom is eligible for the purchase of an insurance policy.

Anyone is able to get insurance on their life. Typically, the cost is the issue when contemplating if this is a policy that is needed by the purchaser.

As the research increases on the causes of death, these findings are put into set of guidelines that are taken into consideration when applying for insurance. For example, a person that smokes cigarettes, or consumes a controlled substance will pay more for life insurance, versus a person that doesn't do these things. Life insurance policy premiums are based on what is more likely to cause the death of a person, when in deed death is inevitable no matter what.

Be extremely careful when gaining an insurance policy. Although, no one is turned down for trying to get insurance on a life, there are things that will increase costs. Anything with carcinogens, are considered life threatening and will raise the degree of risk bracket that is used to determine the costs of policies.

After considering what limits need met to obtain an insurance policy at a rate that falls within your budget. Contemplate who the beneficiary will be, and if this is the best way to prepare for a death. There are other options, where a person can set their own rates. If a separate account is the route you decide on, make sure you calculate for everything that is involved in final expenses.

If you find you are considered a low risk applicant when getting a life insurance quote, and you have people that will need money when you die, life insurance is wise. If you have to make minor adjustments to the way you live to lower your premium and you are willing to abide, life insurance is the best way to go.

Chances are if you are an adult with limited social habits, work behind a desk, and do not have any ongoing illnesses, your premium will be pretty cheap. On the other hand, a middle aged person, that works as a police officer, with testicular cancer that has been in remission, will pay more to insure his life.

The last thing to realize when deciding on life insurance. How much money will the beneficiary receive? Is the ratio of premium payment to benefit feasible? Will all costs be covered? These are a few questions to ask yourself when making a decision.

Graham McKenzie is the content Syndication Manager at insurance123.co.za South Africa's leading Life Insurance information portal.

Article Source: http://EzineArticles.com/?expert=Graham_McKenzie

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All About Business Life Insurance Information By Insurance Experts

2009-08-02T08:56:00.000-07:00

Business Life Insurance - Option to Fund Buy-Sell Agreement
By Kyle J Norton

b) Corporate buy-back of shares.
Premiums of insurance are paid by the corporation.

I hope this information will help. If you need more information of the above subject, please visit my home page at:

Article Source: http://EzineArticles.com/?expert=Kyle_J_Norton

Business Life Insurance - The Advantage & Disadvantage of a Sole Proprietorship
Kyle J. Norton

As we mentioned in the previous article, sole proprietor is responsible for every aspect of their business and they may hire others to carry out these duty.
I. Set up and continuation is uncomplicated.
1. Register a name for the company and renew it as required by law and obtain necessary licenses.
2. A sole proprietor keeps all the gains and is responsible for all the losses.
3. Company incomes are treat as personal income therefore sole proprietorship only pay personal taxes.
4. They also have the power of the right to borrow funds for operating capital or estate settlement needs.
5. The power to change the form of business.
6. Their personal saving bank account is the business capital account.
7. Pay and deduct wages to family members who are usually taxed at a lower rate than the owner.
8. All their personal and business assets are subject to claims of creditors.
9.All loan financing are limited to personal and business assets available as collateral.
10. The business ceases at the death or the owner.
II. If the owner wishes the business to continue, they should:
a) stipulate in the will that the executors and trustees are not responsible for the deceased’s prior business debts as well as subsequent business debts incurred while carrying out their duties.
b) the will should state how the business is to be disposed of.
c) the executors should execute the buy-sell agreement, if one exists. We will discuss how buy-sell agreement with life insurance works and why it is the best solution for sole proprietorship and theirs employees after the death of the owner.
I hope that this information will help you to understand the advantage and dis- advantage of sole proprietorship. If you need more information, please visit my website at http://businessinsuranceii.blogspot.com

Do You Own A Business? Here Are Ways A Term Life Insurance Can Save You A Lot
By Chimezirim Chinecherem Odimba

It's a great thing to own a business. But there are tough times that come with it. What happens when an employee passes on? What happens if they get disabled even it happens outside their line of duty? What happens if a partner passes on? These are tough questions that a term life insurance policy can help you answer with more ease with any risk to your business. Let's look at each of these scenarios in details...

1. What happens when an employee passes on? Believe it or not, it affects your business unless the employee was totally worthless (In which case it will take only a fool to keep such a fellow).

This means that you'd have lost a resource person. And, depending on how specialized their role is, getting a suitable replace will cost you both in money and time.

Furthermore, if you've structured your business right, then you'd have to pay some money to the deceased's family even if it's NOT required by law in your country.

Can you imagine how motivated your other workers will be if they see the bumper package given to their colleague's dependents by your business? These all will cost money.

Taking out a term life policy on your employees and naming your business as beneficiary will do you a world of good if such arises.

2. What happens if your partner passes on? Would you allow your business to go under by being forced into a partnership with an heir who isn't apt for the business? Wouldn't it be a better deal if you bought over your partner's share of the business?

But where do you get the money for this? This won't be a problem if you took out a term life insurance policy for your partner with yourself as the named beneficiary.

Term life insurance gives you the most bang for your bucks. But more interestingly, you can pay even far less if you took the time to get and compare quotes from a wide range of insurers.

Here are great pages for life insurance quotes...

InsureMe Life Insurance Quotes

Life Insurance Quotes

Chimezirim Odimba writes on insurance.

Article Source: http://EzineArticles.com/?expert=Chimezirim_Chinecherem_Odimba

Life Insurance Premium Financing
By James J. Robinson

Life insurance premium financing is used by wealthy individuals to pay their life insurance premiums. By financing your premiums, it allows you to free up the funds that might have otherwise been used to pay your premium. Many wealthy people require a substantial amount of life insurance for business planning, estate planning, or for income replacement.

In order to qualify for life insurance premium financing most insurance companies require you have a minimum of $2.5 million in net worth and at least a $200,000.00 a year income. In addition, you must be bankrupt remote entity, such as a Limited Liability Corporation, or an Irrevocable Life Insurance Trust.

In a normal premium financing arrangement, you would apply for a policy at the same time you apply for a loan. The loan is usually arranged by the insurance company you are working with although there are many different companies that handle only the financing and do not deal with the actual insurance policy. While you are being medically underwritten for the life insurance policy, your loan is being processed. Assuming you pass the medical exam and qualify for the loan, the policy and financing are put into place at the same time.

The benefits of a premium financing arrangement is that it frees up business and personal money to be used more efficiently in other investment arenas. In addition, life insurance premium financing may minimize gift taxes, and can provide a greater rate of return on the death benefit paid through regular non-financed methods.

Life insurance premium financing loans may be repaid either by paying a monthly payment while you are alive, pay from the policy itself, or at the time of your death, proceeds from the policy will pay off the loan.

Interest on the life insurance premium financing loan is considered to be personal interest, and therefore, not tax deductible.

If you are considering a premium financing loan for estate planning, there are some tax issues you may want to consider. The life insurance proceeds will be included in your estate if you own the policy. If the life insurance policy is owned by an irrevocable life insurance trust, estate taxes on the death benefits may be avoided.

Before you consider financing your life insurance premiums you should be aware that the life insurance policy will have to earn returns of between 150 to 300 basis points over the interest rate of the loan.

In addition, you should ask what the loan commitment fee is, as well as knowing whether the life insurance premium financing loan is renewable, how long the term of the loan is, and if the loan extends well beyond your life expectancy.

You may want to find out if the loan requires a personal guarantee, or if the loan is guaranteed by the life insurance policy.

Also, you want to know how if the program is designed on your IRS calculated life expectancy or is it conventional. If the loan is based on your life expectancy, and you live beyond that, the loan amount will exceed the cash value and the whole program will come apart.

Before entering into a financing agreement you may want to consult a trusted attorney, your financial advisor, and/or your Certified Public Accountant.

You will also want to shop around and compare insurance companies, their individual plans, the premium amounts, and the different types and amount of life insurance available to you.

Get started comparing life insurance quotes now!

Article Source: http://EzineArticles.com/?expert=James_J._Robinson

The Buy-Sell Agreement- Why It Is The Simple Solution
By Robert Cavanaugh

If you own a business, odds are the business represents a sizable portion of your estate. Therefore, planning for the orderly disposition of the business is an important planning consideration.

The most basic element of the plan involves the use of a buy-sell agreement. It is astounding how many business owners do not have a buy-sell agreement. Even more amazing is the numbers who have one, but have no method to fund it. Let's take a look at the rationale behind a funded buy-sell agreement.

Creates a Market

Most businesses are closely held. A person can't call their stockbroker and buy shares in the business. Essentially, there is no market for the business.

If the business is a sole proprietorship or one-man or one-woman corporation, who is going to buy the business when the owner dies? In rare cases, a family member may be able to step in and successfully continue the business. Most of the time, the businesses simply closes its doors.

If the business owner is a partner or minority shareholder in a corporation, where is the financial motivation for the other owners to buy a minority interest? A buy-sell agreement among the person's partners, or one involving one or more key employees for the sole owner, creates a market for the business.

Avoids a New Partnership With the Heirs

In my experience, there is no quicker way to get a male business owner's attention with respect to business succession planning than to ask two questions.

"Do you and your partner have a buy-sell agreement?"

"No."

"If your partner died, would you like to be in business with his wife?"

Silence.

When a partner dies, and the dust settles, generally one of two things happens. The wife calls up her husband's partner and asks where her paycheck has been for the last month. The partner has to explain that her husband's salary was a result of his active participation in the business, not tied simply to the fact that he owned stock in the business.

The second possibility is the wife, who has no experience or participation in the business, takes over her husband's position.

A buy-sell agreement avoids both of these scenarios.

Sets the Price

Assuming buyers surface, what is the value of the deceased owner's interest? If the seller is the deceased owner's family, they want as much as they can get. The remaining partners want to pay as little as possible. Oftentimes, the dollar amount is far apart.

By setting a price that everyone is happy with while living, there is no haggling over price at death. In addition, this "pegs" the value of the business for estate tax purposes. In the absence of an agreement, the estate lists a value on the estate tax return, if one is required. The IRS often comes back with their valuation opinion: a much higher amount. What ensues is a back and forth argument, involving attorney's fees and stress. Some of these cases have dragged on for as much as ten years.

Converts an Illiquid Asset to Cash

A properly funded buy-sell agreement instantly converts bricks, mortar and steel into cash. This provides funds for the heirs to pay obligations and taxes. Cash can be invested to generate an income; cash is easily divided among heirs.

Funded With Life Insurance

Assuming that a buy-sell agreement has been drafted, the next question becomes, "Where will the funds come from for the obligation now mandated by the buy-sell agreement?" There are three typical choices.

1. Pay cash. This is only an academic choice. Most businesses don't have cash in these amounts laying around.

2. Buy out over time. If the business interest is worth $500,000, the arrangement is to pay, for example, $50,000 plus interest over 10 years. Negotiations could be tough. The family wants their money as quickly as possible; the remaining owners want to string it out for as long as possible.

This option is expensive. It requires the survivors to pay principal plus interest. The payments put a mortgage on future earnings and have to go through the tax wringer. The result is paying much more than a dollar for each dollar of business interest purchased.

3. Fund the agreement with life insurance. This is the "discounted dollar" method. Money is available immediately to fund the agreement, and the total premiums on the policy will come nowhere near the amount received.

If you own a business and do not have a buy-sell agreement in effect, call your life insurance agent, attorney and accountant. Set up a meeting, come up with a value, have an agreement drafted, and fund it with life insurance. You have probably spent a lifetime putting your business together. Now allocate a couple of hours toward keeping it together for your heirs and circumventing a myriad of problems.

Robert D. Cavanaugh, CLU is a 36-year financial and estate planning veteran and author of the free newsletter, "The Estate Preservation Advisor". For cutting-edge, easy-to-understand financial planning resources and techniques to increase your income, reduce taxes and preserve your estate and to claim the free video, "How to Sell Your Life Insurance Policy for More than the Cash Value", go to http://theestatepreservationadvisor.com/rd/subscribe.htm

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All About Business Life Insurance Information By Insurance Experts

2009-08-02T08:54:00.000-07:00

Key Man Life Insurance
By Julie Shields

One of the most significant uses of life insurance in a business is "key man insurance". With key man insurance, your business financially secures itself against the potential early loss of someone who is so vital to the company's profits or continuance that without them it's a very realistic possibility that your company will suffer severe financial losses or have to fold entirely. Key man insurance is most often used by smaller businesses, but big businesses also use it.

Key man life insurance is different from disability insurance on a key man. Life insurance on a key man (or woman, for that matter) covers against the permanent, irrevocable loss of them from participation in the business. It pays out the death benefit to the company (which is also the payer of the premiums), which can then use the proceeds to pay off creditors, make it affordable to hire a successor, or set up a "buy-sell agreement" to buy out the deceased company (wo)man's shares.

Now, many people naturally assume that the key man insurance policy needs to be on the company's founder/owner or a member of the highest ranking executive management. This is, indeed, often the case. But it doesn't necessarily have to be that way. The "key man" (or men; there can be more than one) might be a top salesman without whom your business will take serious hits to its revenues; or that marketing director without whom nobody knows where or who you are.

So, when should your company consider buying key man life insurance one one or more members or employees?

Again, if the ongoing activities of the business are heavily dependent upon a certain person, that's one time to consider key man insurance. One note: if the key member in question is under the age of 65, s/he should also have a disability insurance plan that coordinates with the key man life insurance. You see, working people under the age of 65 are far more likely to become disabled than to die an untimely death. If you coordinate your key man life insurance with disability insurance, you'll save on premiums while having a better comprehensive insurance plan.

Key man life insurance can also be necessitated if a smaller business takes out a business loan. The loan is officially granted in the name of the key persons, who in turn take out at least enough of a life insurance policy to pay off the full principle of the debt if they die before the loan is paid back.

With some smaller businesses, they have a great salesman who brings in a very large percentage of their revenues. If he dies, it will be difficult to replace him, and there will be a time lag between his death and finding and training the new salesman anyway. During this time, company revenues may go down through the floor. The company can use the death benefit proceeds to keep paying expenses that would have been paid for by that salesman's work. An analogous situation might exist for, say, an IT company that has a "genius" software designer or computer scientist on its staff--without her, they could very well see a precipitous drop in productivity for a while and will need the death benefit pay to sustain them while they find a replacement or adjust.

Now, how much death benefit should be carried on the key man? This depends on both the size and the debt situation of the business. Some companies carry this life insurance policy in face amount that's just twice or triple the person's annual salary. But many such policies are written for as much as 15 times their annual salary.

If you feel that you need this kind of life insurance for your company's most important person or people, consult with some life insurance agents to find out how to acquire it.

The author lives with her husband in Maryland, with their two dogs and cat. She put together the website http://www.affordable-life-insurance-guru.com in order to help the everyday person navigate the often confusing world of life insurance

Article Source: http://EzineArticles.com/?expert=Julie_Shields

Term Life Insurance - A Safeguard for Small Business Owners
By Carrie Reeder

That's where term life insurance comes in.

Whether you choose whole life or term insurance, though, key person insurance is a protection that your company shouldn't be without.

To view our list of recommended Life Insurance Companies, visit this page:
Recommended Life Insurance Companies.

Carrie Reeder is the owner of eZerk, an informational website with articles and the latest news about various topics.

Article Source: http://EzineArticles.com/?expert=Carrie_Reeder

Buy Sell Agreement - Life Insurance Buy Sell Agreements For LLC Or Corporation Business Partners
By James J. Robinson

The first question most people have is what in the world is buy sell life insurance? In closely held businesses the death of one owner can cause a plethora of inconvenient issues to arise within the business. Depending on the deceased owners' estate planning, the remaining business partners could face a number of legal and financial hurdles.

A buy-sell agreement is a contract among business owners, where upon the death of one of the owners, the remaining owners are required to purchase the deceased's interest via the terms of the contract (buy-sell agreement) and the deceased's survivors or heirs are required to comply by selling their inherited interest at the pre-determined price.

The buy-sell life insurance method is becoming more and more attractive to business owners because it avoids the question of how family members are to ensure they are receiving a fair price for their inherited share in the business. It also avoids the corporation having to produce a large amount of cash to redeem the heirs' interest in the corporation, and it avoids corporations having to deal with unwanted and potentially inexperienced partners (such as the spouse of the deceased).

Cross Purchase vs. Stock Redemption

There are two basic formations of buy-sell agreements. The first is a cross purchase agreement. The next is a stock redemption agreement. In a cross purchase agreement each owner of the corporation will purchase a life insurance policy on the other owners, and will in turn be named the beneficiary of the policy. In a stock redemption agreement the corporation purchases the life insurance policies. In each instance when an owner dies either the corporation or the other owners will use the proceeds of the life insurance policies to redeem the deceased owners' interest in the corporation.

Pros and Cons Of Buy Sell Agreements

These agreements are financially advantageous to both the corporation and the individuals that stand to inherit interest in the corporation. The fair market value of the owners' shares are agreed upon at the time of the signing of the buy-sell agreement. The proceeds are paid out to the other owners who then use the funds to purchase or buy out the deceased owners shares. There are no income tax consequences to the deceased's family as a result of the "sale", nor are the proceeds subject to corporate creditor claims or the corporate alternative minimum tax. As a result of the life insurance proceeds there is a lump sum of cash available to buy out or "fund" the agreement at the time of death, without having to go thru the probate period required by most states.

There are some drawbacks to the life insurance buy-sell agreement, most centering around the premiums paid into the life insurance policies during the lives of the owners. Since insurance premiums are not paid with pre-tax dollars, they are usually not tax deductible. Depending on the age and health of the owners, some of them might not be insurable. The uninsurable owners would really have no incentive to participate in a buy-sell agreement, which would result in an inequitable situation in regards to stock redemption agreements. Also, since interests and ages of the owners of the corporation could vary widely, there is a chance that the corporation will have to pay higher premiums for older owners and for those with smaller interest to pay a disproportionate share of premiums.

There are other ways to fund buy sell agreements, each with their own set of advantages and disadvantages. However, depending on the size of your corporation (or partnership or LLC), age and interests of its owners the life insurance buy sell agreement is an excellent way to ensure that your family and co-owner have the easiest transition of your shares in the event of death.

Buy Sell Agreement Life Insurance Quotes

Be sure that you shop around and compare life insurance quotes from multiple companies before purchasing a policy. A little bit of research spent early on will be well worth it when it comes time to draw up the paperwork.

Get started shopping around and finding life insurance today!

Article Source: http://EzineArticles.com/?expert=James_J._Robinson

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All About Business Life Insurance Information By Insurance Experts

2009-08-02T08:50:00.000-07:00

Business Life Insurance - What is Buy-Sell Agreement?
By Kyle J Norton

Buy-sell agreement is a legal contract drawn by the lawyer that indicates in detail of the parties to the agreement, an evaluation method of the business and method of payment for the following occurrences:
1. Death.
2. Disability.
3. Disillusionment.
4. Transfer of business interest at retirement.

Buy-sell agreements are used in any types of business including a sole proprietor or partnership. Since these types of business must legally close their doors when the owner or partner dies. The use of buy-sell agreements allow the business to continue while the new owner completes the transfer of ownership without going into debts.

Here are the buy-Sell agreement guarantee commitments:
1. Each party will transfer their interest to the surviving partner(s). This agreement will also bind their heirs and estate to the agreement.
2. Each party will pay the purchase price as indicated in the agreement.
3. All parties will buy and maintain sufficient life insurance to fund the agreement.
4. The procedure for the additional payment required if excess of the insurance proceeds.
5. The method of how dispersal of insurance proceeds in excess of the business interest.
6. The method of storing and maintenance of the funding life insurance policies.
7. The method of how dispersal of the survivor's policies after transfer of the business interest.
8. Each party agrees that the deceased's estate shall be held free and clear from liability to the business creditors after the transfer of business interest is completed.

Both parties must also agree to the method of funding this buy-sell agreement:

1. Life insurance
If life insurance is used to fund the buy-sell agreement then life insurance on the lives of all parties concerned needs to be applied for and put in place. The contract may be held as a legal document until needed.

If one of the parties is not insurable, joint life last to die on the lives of the partner and spouse may be a solution. The sum insured, paid out on the second death, would then fund the agreement.

2. Non-fund contract
Here are also some non-funded methods that can be used to pay out the survivors after death of one of the parties:
a) Borrow the Funds
Requires sufficient collateral and payback.
b) Bring in a New Investor
It is always difficult and may be costly to the heirs of the decreased partner
c) Set up Sinking Fund
It may be far more expensive than life insurance and adequate time to set it up may not be available.
d) Sell Company Assets to Pay Out Deceased's Estate
It is very counterproductive to the carrying on with business as usual.
f) Payment out of Profits

Payment is made out of the business interest, usually over a number of years. This can create a business risk and brings future uncertainty into the arrangement.
In fact, using life insurance to fund the buy-sell agreement is always the least expensive and most functional approach.

I hope this information will help. If you need more information of the above subject, please visit my home page at:

Kyle J. Norton
http://lifeanddisabitityinsuranceunderwriter.blogspot.com/
http://businessinsurance14.blogspot.com/
All rights reserved. Any reproducing of this article must have all the links intact.
I have been studying natural remedies for disease prevention for over 20 years and working as a financial consultant since 1990

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How the Insurance Business Works
By Sarah Martin

In some lines of insurance, one additional type of service is important: engineering and loss prevention. The quality of engineering service varies from company to company.

A well qualified corps of inspectors may weigh the balance in favor of a given company for a boiler and machinery line. And an imaginative engineering department may be the deciding factor which swings a workman's compensation line from one company to another.

Wherever insurance is concerned, there is no one best life insurance policy. Many arguments have been and will continue to be advanced by the proponents of each of the several types of companies. Each group rightfully can claim some advantages; each has some disadvantages.

Variations are present among carriers of the same type. These are more important than variations among types of companies. Factors that should be considered in selecting a carrier are its financial condition, its services, and its rates. Competition tends to reduce the points of distinction among carriers.

Here are some questions that outline life insurance basics and may help you to better understand how insurance companies work:

• Many people who accuse the mutual insurance companies of doing business contrary to the traditional American way often exclude mutual life insurance companies from their attack. How do you account for this lack of consistency?

• Mutual companies are not automatically stronger than stock companies, nor are stock companies automatically stronger than mutuals. By making use of financial data reported in either the Spectator Insurance Year Book or Best's Insurance Reports, demonstrate the authenticity of this conclusion.

• It is generally said about any product that you get just about what you pay for. It would not be too difficult to disprove this comfortable axiom in so far as the insurance business is concerned. How would you go about it?

• Since mutual insurance companies generally write insurance at lower net rates, how do you account for the fact that they have not driven the stock companies out of business?

• Why have the mutual carriers been so much more successful in the medical insurance business than in the life insurance business?

• If participating life insurance policies are held long enough, the dividends paid on it may more than offset its higher initial cost. How long will a participating policy have to be held before it becomes cheaper than a nonparticipating policy? Under what circumstances may it never become cheaper?

• By far the larger percentage of new life insurance is written by mutual companies, whereas the overwhelming majority of fire insurance is written by capital stock companies. Does this prove the superiority of either type of company in its field?

• If Best's Insurance Reports rate a company as "good" or even "very good," does this mean that an insurance buyer can purchase low cost life insurance from this company with complete confidence as to its financial stability?

• What are the factors that should be considered in appraising the financial standing of an insurance carrier? Select your favorite carrier and appraise its financial condition in so far as you can ascertain it from published reports.

• You are the general manager of the Big Value Corporation and have asked your insurance manager to write a report justifying his selection of insurance carriers for presentation to the board of directors. What type of information would you expect to find in this report?

• A large university has established an insurance buying policy which prohibits the purchase of more than 25 % of its insurance in mutual companies. Is this a sound policy?

• A university calls for bids on its insurance and generally divides its purchases among a number of different agents. Are there any disadvantages to this type of buying policy?

• Is it possible for a city or county to do business entirely with one agency without antagonizing the rest of the agencies in the community?

• You are a member of your state legislature and a bill is before you to establish a state fund for life insurance without medical. How would you vote? How would you explain your position to your constituents if called upon to do so in your campaign for re-election?

Sarah Martin is a freelance marketing writer specializing in finance, business, and different types of low cost life insurance. For life insurance without medical quotes, please visit http://www.equote.com/.

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Small Business Insurance 101 - Do I Need Insurance For My Business?
By David Gianella

Insurance can cover a variety of catastrophes including natural disasters, fire, and theft. Providing good health coverage for your employees can help you retain them. However, these are not the only types of insurance available. You may be required to carry life, business interruption, or auto insurance depending on the nature of your business.

Other types of insurance cover business liability or damage to your inventory. The easiest solution for new business is to purchase a business owners policy or package policy. These packaged policies cover the most common business insurance needs and are usually cheaper than buying the policies one-by-one. If there are specific insurance needs required for your business, such as product liability or professional liability, you can purchase these separately.

Banks, investors, and other lenders may require a business owner to have good insurance coverage before processing a loan; this minimizes their risk of losing their investment. Investors and partners may also require a business to have a "key man" insurance policy-life insurance on the owner or crucial employees-so the business can survive in the event something happens to these people.

Who Should I Call?

There are a couple of different ways to buy insurance for your business. Institutions you already have a relationship with-such as your bank, home insurance agent, or accountant-may be able to recommend an insurance agent. Ask fellow entrepreneurs who are in the same industry to suggest an agent. You can also reach out to your Local Chamber of Commerce. If you do not know anyone in the same field, visit a place of business and ask to speak with the owner.

Make sure you contact your industry trade associations; there might be specialized insurance companies that cater to your industry. Visit Web sites such as http://www.idealist.org to get a list of non-profit associations catering to your industry. Contact these associations for a list of insurance providers.

Have a Great Business Idea but can't find Capital? Get Bankers and Investors Interested learn how http://revuelve.com

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All About Business Life Insurance Information By Insurance Experts

2009-08-02T08:46:00.000-07:00

Business Life Insurance - Understanding the Statement of Retained Earnings and Cash Flow
By Kyle J Norton

Beside understand what is business insurance and business life insurance are important that people own a business understand , so they can protect their business in case of any unforeseen event happened causing hardship to the business owner and their family such as business store burned down one day, if you don't carry insurance, you would endured some hard times after that. Understand operations of the company also equally important for a successful business. In this article ,we will try to discuss what is the statement of retain earning? and cash flow of the company.

Statement of retain earning is the accumulated of that portion of the shareholders equity derived from a profitable operation since the corporation stared it business.

I.There are two ways to express a Statement of Retained Earnings.

1. Retained earnings (end of year)= retained earnings (beginning of the year)+income for the year- dividends

2. Year end retained earnings= income (for the year)-dividends+ earnings retained (during the year)+ previous year balance

Total accumulated retained earnings does not normally reflect a cash position, but reflects the value of equipment, machinery or inventory and other assets. Instead of paying out all revenue each year as received in salaries or bonuses, a portion is retained to replace equipment and inventory and to finance expansion.

II.Cash Flow
Cash Flow is best expressed and understood in terms of inflow and outflow of cash.

1. Inflow

Inflow is the amount of cash that the company earned, such as additional sales, new investments and new borrowing.

2. Outflow

outflow is the cash that the company has expended in a period of time and it can be controlled by the timing of payments, replacing of equipment or postponing hiring and expansions.

I hope this information will help. If you need more information of the above subject, please visit my home page at:

Kyle J. Norton
http://lifeanddisabitityinsuranceunderwriter.blogspot.com/
http://businessinsurance18.blogspot.com/

I have been studying natural remedies for disease prevention for over 20 years and working as a financial consultant since 1990.

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Life Insurance - The Good, The Bad, & The Ugly
By Joseph Chappine

The Good.

If you have ever received a large check in the form of life insurance proceeds after a loved one has died, you understand the "beautiful sadness" that is felt.

When the check arrives it does not ease the pain of your loss. Rather, it adds to your fond memories of the loved one. This person cared enough about you and your family that he/she wanted to ease the financial impact which their loss of life would surely create.

A good example of this would be the woman with an infant child who purchased enough life insurance, not only to help pay the bills, but enough to make certain the child would be raised by the proper loved one. Perhaps, she wanted her mother or a sister to help raise the child, but that person could not afford the loss of income. Properly planning, she left enough money to reimburse the care giver's loss of income. This type of planning shows her devotion to the child.

The man who leaves an extra $20,000 to be set aside and used exclusively for the expenses of a wedding, will not only be reminding his little girl "I love you", but will also be saying, I'm still with you.

The Bad.

An improperly planned future is both bad and sad. One's entire financial situation should be analyzed and protected. A person buying a $1 million whole life insurance policy, rather than a disability or income protection policy and a term life insurance policy qualifies as bad.

Would it make much sense to purchase life insurance and have no health insurance? Would purchasing cancer insurance before disability be intelligent? These types of decisions are made every day by people who either do not think or do not know better.

The Ugly.

Doing absolutely nothing, or making financial decisions without receiving professional advice, results in the ugliest of situations. Far too many people take whatever insurance is offered by their employer and think they have enough. Show me an entity providing free benefits to all of their employees, while making certain that each individual is set for life financially and I'll show you a member of the United States Congress or Senate. (Sorry. I digress).

The insurance industry estimates that over 70% of the people in United States have never met with an insurance agent. This is beyond ugly. It's stupid!

After 33 years in the business, I still find occasion to request advice from an associate. The industry is constantly changing. For that reason, each state requires continuing education to make certain an insurance agent remains current on these changes. Why would the average person, without any insurance back ground, try to make these decisions alone? Please don't. Wouldn't you prefer your loved ones feel a "beautiful sadness" after your death. I would think it much better than sadness...and misery because the family cannot sustain the life style which it enjoyed previously!

Joseph Chappine. Licensed insurance agent since 1977.
Mr. Chappine has recently created a web site which has established a relationship with professional agents covering every county across the United States and Puerto Rico. Visit this site, http://www.termorwhole.com if you are looking for a local professional. If you would like to learn more about life insurance visit http://www.bestenrollments.com/life.htm

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Top Insurance Company Secret Revealed - AIG Life Insurance Company & Others Risk All Buying Business
By Donald Yerke

The Top Secret Revealed

How Buying Business Works

Their poor planning style on buying business was greed motivated, poorly planned, and misfortune bound.

The logic of governmental & taxpayer bailout is far from a guaranteed solution. On that subject I will leave it to anyone who passed Economics 101 to explain.

The website address is http://www.agentsinsurancemarketing.com

Save more than 60% Visit the website to get a package of Ebooks at under $1.99 each.

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All About Business Life Insurance Information By Insurance Experts

2009-08-02T08:40:00.000-07:00

Ordinary Business Life Insurance
By Sarah Martin

The ordinary business Metropolitan Life Insurance Company prospered anew soon after 1892. This new lease on life was due not only to the low cost of the contracts, but also, in large measure, to the wide variety of plans available and to the many liberal features Mr. Fiske had incorporated in the policies.

During 1892, 1,704 ordinary policies were written for approximately $2,000,000, as compared with 178 policies for less than $200,000 the year before. The ordinary insurance on the books jumped rapidly from approximately $5,300,000 in 1892, to almost 10 times that sum only five years later. Before the turn of the century more than $110,000,000 of such business was in force, representing close to 125,000 policies.

Whereas in 1891 the Metropolitan Life Insurance Company was at the bottom of the list of ordinary companies operating in New York, it had reached fourth place as regards business written in this Department by 1900. After the Armstrong investigation the company forged ahead at an even more rapid pace, narrowing the margin between itself and the older, larger companies. Between 1906 and 1913 the ordinary business in force gained $609,905,310.

In the same period the New York Life gained $243,493,494; The Mutual $81,208,898; the Equitable $94,417,206. The Metropolitan thus gained nearly 50% more than all these three combined. Only a decade later, in 1923, the Metropolitan had become the largest ordinary insurance company in the world as well as the largest in total insurance in force. This standing, moreover, had been achieved without general agents or salespeople other than the men who represented the company on the so called industrial "debits," that is, the territory which each agent serves.

Shortly after the ordinary business was reestablished and the company's agents began to canvass for this type of insurance, they found that a considerable number of working people were able to pay premiums quarterly, but could not afford to buy insurance in sums as large as $1,000, the minimum amount for ordinary. To provide this group with protection, the company in July 1896 began to issue intermediate insurance, i.e., policies for $500, with premiums payable annually, semiannually, or quarterly.

It is not surprising that the Metropolitan should have pioneered in this field, since it has always blazed trails in bringing insurance protection to the lower income groups, such as no medical exam term life insurance. This new form of insurance likewise found a ready market. After the first six months 5,110 Intermediate policies were on the books for $2,555,000. At the end of 1901, only 5 1/2 years after this department was launched, there were nearly 110,000 Intermediate policies in force for an amount close to $55,000,000.

Within the next three years these figures more than doubled, and continued to increase rapidly. The use of intermediate insurance has been subsequently extended to include persons in somewhat hazardous occupations and for those with physical impairments which make them ineligible for standard ordinary policies. To widen even further the circle of protection, the Metropolitan in 1899 inaugurated "Special Class" policies for those who, because of occupation or physical impairments, could not meet the standards of ordinary or intermediate insurance.

An even more formidable task than building the ordinary department confronted Mr. Fiske when he joined the Metropolitan. Industrial insurance was under severe attack. Even before the Hegeman Fiske administration came into office, the storm clouds had begun to gather. Late in the 1800's a number of attacks were directed against industrial insurance. Incredible, but nevertheless true, was the fact that some worthy citizens of the day actually charged that life insurance policies on children endangered their lives because a number of parents would let their children die of neglect, or murder them for the insurance proceeds. This was an era of muckraking, and the sensational attack on Big Business, life insurance companies included, found a sympathetic response among certain legislators, newspapermen, and others who took up the cry.

Sarah Martin is a freelance marketing writer based out of San Diego, CA. She specializes in life insurance policies and the history of the Metropolitan Life Insurance Company. For a free no medical exam term life insurance quote, please visit http://www.equote.com/.

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Life Insurance - An Important Part of Your Business Succession Plan
By Denise M

No matter how certain the future seems, there is always a need for a business succession plan. It's all too easy to give planning a miss when things are going well. But what happens when an unforeseen illness, a natural disaster, a premature death, or the sudden retirement of top management turns all your progress upside down? No one can plan for every type of disaster no matter how good you are at revenue projections or economic predictions. The reasons for having an efficient business succession plan are therefore manifold. With a number of contingency plans, you can ensure that your company stays afloat irrespective of whatever catastrophe occurs. Life insurance plays an important part in a business succession plan and can be easily integrated with many of the techniques and strategies often used in business succession planning. These could include:

Buy-Sell Agreement Funding - If a company has multiple partners and one of the owners dies, the shareholder's agreement most probably has the provisions for the shares of the deceased owner to be purchased by the other owners. In such situations, life insurance is the best way to provide the cash necessary to purchase the deceased owner's interest. In many cases and depending on how the policy is structured and the type of business involved, the premiums are often tax-deductible and the insurance benefits are also tax-free.
Key Person Insurance - A company is generally insured against the loss or damage of its property since office equipment and inventory are considered valuable assets. But, what about the value of key employees? Key employees are possible a company's most valuable resource. If this key person prematurely passed away, there could be a serious impact on profits and a sudden increase in costs with relation to hiring and training another suitable replacement. Insuring the life of a key employee can provide extra cash that will help keep the business running and offset any consequent reductions in revenue. There are some banks that demand key person insurance when approving significant business loans. This assures them that an unexpected death won't mean the end of the company and the lapse of any of their loan payments.
Estate liquidity - If business owners transfer all or most of their business interests to family members only after their death, life insurance can provide the children the cash necessary for them to pay estate taxes. Life insurance is also an easier (and less expensive) alternative to deferring estate taxes.
Estate equalization - In case a business owner leaves the business only to some children (active children), his or her life insurance can be left to the inactive children, thereby equalizing the inheritance among all the children. This policy is often owned by an irrevocable trust and also avoids the need and the unnecessary expense of buying off the company interests of the inactive children by the active ones.
Non-Qualified Deferred Compensation Plans (NQDC) - A NQDC can be used by a small business to provide members of the senior generation with death, disability and/or retirement benefits. This is especially useful in situations where senior members no longer receive any compensation from the company and have handed over the business to the junior members. The tax-deferred cash value growth and tax-free death benefits make life insurance a popular means to fund an NQDC plan.
Family bank - When a business is left to both active and inactive children, it is recommended that the voting interests lie only with the active children in the business. A life insurance policy on the owner's life will create a 'family bank' that allows the active children to satisfy the needs and demands of the entire family. This policy is generally maintained as a trust for the benefit of the active children.

The requirements for life insurance can vary from company to company and individual to individual. It is a complex process that needs several factors to be taken into consideration such as the nature of the business, the needs of the owners, along with individual financial and family situations. But, as life continues to change, the one certainty that remains is the need to plan and prepare in the present for a hassle-free secure future.

AccuQuote is a leader in providing term life quotes to people across the United States. In 1986 it began operating with a single goal: to make the process of buying term life insurance as easy as possible for its customers. Their experienced professionals consistently deliver the most affordable term life insurance rates by comparing thousands of life insurance policies from dozens of top-rated carriers.

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Business Life Insurance - Option to Fund Buy-Sell Agreement
By Kyle J Norton

b) Corporate buy-back of shares.
Premiums of insurance are paid by the corporation.

I hope this information will help. If you need more information of the above subject, please visit my home page at:

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