Life Insurance Solutions

There are several advantages of using life insurance to help build a legacy and transfer wealth to the next generation.

Death Risk

Only life insurance provides death benefit protection that can be there when your clients’ loved ones need it most.

Serious Illness Risk

The policy may include the ability to accelerate the death benefit should the insured be diagnosed with a qualifying serious illness.1

Opportunity Risk

Purchasing life insurance can create an immediate increase in the client’s estate value in the form of a generally income-tax free2 death benefit.

Probate Risk

When your clients complete a beneficiary designation on their life insurance policies, the client’s privacy can also be protected from the complexity of probate.

Beneficiary Risk

When the insured passes away, the death benefit passes generally income tax free to beneficiaries.2 Having the right beneficiary designation can help save time and money, and help relieve stress.

Client Risk

Premium payments into a cash value life insurance policy may accumulate cash value on a tax-deferred basis.8 Through policy loans and withdrawals,3 the cash value may be used as an emergency fund.

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Your Next Steps

Think about your clients and whether you have an opportunity to help maximize the wealth they leave behind while minimizing the hassle for the beneficiaries. Here are some steps you may want to consider taking.

  1. Identify your client’s death benefit need and establish whether a Wealth Transfer strategy is appropriate.
  2. Review your client’s financial assets and develop a strategy.
  3. Meet with your client’s children to discuss the strategy.
  4. Consider moving some of your client’s assets to a permanent life insurance policy.

Who do you know?

If your clients…

  • Have a need for death benefit protection
  • Are between the ages of 50-80
  • Have $50,000 or more earning low interest in an account
    such as a:
    • Savings account
    • Money market account
    • Annuity
    • Or other low-interest accounts
  • Have a desire to keep access to their assets, just in case.

…then this wealth transfer strategy could be a good fit for them.

You can probably find three people in your current book of business that fit the above description. Give them a call today.

Considerations

There are also some considerations of using permanent life insurance, such as:

  • Cost of insurance charges (COIs) and other charges: life insurance comes with charges that you and your client need to be aware of for planning purposes.
  • Loss of premium: depending on funding, life insurance may not guarantee avoiding loss of premium.
  • Maintaining the death benefit: additional premiums may be necessary to continue the desired death benefit, depending on funding.
  • Modified Endowment Contracts (MECs): MECs may have tax implications that you and your client need to take into consideration.7
  • Surrender charges: withdrawals may be subject to surrender charges and the amount available for policy loans.

Need help mitigating the risks in your client’s financial strategy?

Contact Midland National Sales Support at 1-800-843-3316, ext 32150.