Howdy from the Premium Finance World

[MintFish]

Howdy Everyone,

First of all, I completely respect the rules of this forum and I am not here to promote, sell or advertise my services. I am here to join in the discussions and learn just like everyone else.

I really am interested in learning more about the challenges agents face in dealing with premium financing.

Thanks!

 

[Macallan]

Using a loan to pay for insurance premiums? That doesn't sound like a good idea to me. I cant seem to think of a scenario where asking a client to go into debt to pay a premium that they cant afford is wise act as a fiduciary. I would also be concerned about the charge back when the policy lapses from non payment of a premium that the client could not afford to begin with.

Maybe I'm misunderstanding your question. Can you enlighten us further?

 

[DHK]

Your understanding of business and estate planning is sorely lacking.

If you have an IL-LIQUID estate and/or business holdings (buildings, intellectual property, etc.), the IRS still expects payment of estate taxes within 9 months of passing. So, if you plan ahead, you can borrow the money to pay premiums for life insurance.

This is NOT for the average consumer, but a tool for high net worth individuals and businesses.

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You can learn about business planning rather well here:


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"Fiduciary duty" without a solid foundation of knowledge promotes unfounded "morality" in financial advice.

 

[MintFish]

Using a loan to pay for insurance premiums? That doesn't sound like a good idea to me. I cant seem to think of a scenario where asking a client to go into debt to pay a premium that they cant afford is wise act as a fiduciary. I would also be concerned about the charge back when the policy lapses from non payment of a premium that the client could not afford to begin with.

Maybe I'm misunderstanding your question. Can you enlighten us further?

Hi Macallan,

Sorry for any confusion. There was no question, I was simply introducing myself as a new member.

However, to address your concern, we only finance commercial insurance, not personal. There are some finance companies that do finance personal insurance, but there is a significant market to finance business insurance for budgeting and cash flow reasons.

Also, as DHK mentions, premium finance plays a large part in life insurance for high net worth individuals, but we are not in that business at this time.

I'm happy to answer any questions.

Thanks!