TROY, Mich., Jan. 27, 2012 /PRNewswire via COMTEX/ -- The owners of American Premium Finance today announced the availability of their online resource site dealing with life insurance premium financing. This site, put together by premium financing specialists, is designed to be a "one-stop shop" for those wondering if life insurance premium financing is right for them.
In essence, premium financing is a technique whereby high net-worth individuals can secure a high payout life insurance policy without having to tie up their personal assets in order to cover the policy premium. According to the site owner, Alex Miller, "Typically these premiums are designed for the special needs of high net-worth individuals, so we are talking about policies with a death benefit payout of one million USD or more. Instead of having to come up with the cash -- or surrender personal or business assets -- to cover the yearly premium, arrangements are made with a financial institution to have them pay the premium, the cost of which is covered by a short-term loan. The policy holder makes regular loan payments, but the insurance premium has been paid by the financial institution, thereby keeping the life insurance in force during that time."
According to Miller, more and more businesses are taking out life insurance policies on their key employees, business officers, CEOs, owners, and the like. "Whenever a business loses a key player in their corporate roster, this can precipitate a crisis. Where will the company come up with the funds to hire a new person? What if the death of that individual causes key customers to quit doing business with that firm? How will they make up for those lost sales? A life insurance premium can provide the funds necessary to get that firm through this difficult time."
"In addition to paying the required premium to maintain the policy, it can serve as an investment vehicle. Business owners could finance an income stream for the business, and they can also keep any extra funds within the business. In addition, the value of the policy can continue to grow, and it will do so on a tax-deferred basis. This makes these policies extremely attractive, especially in today's difficult economic environment."
The site -- AmericanPremiumFinance.com -- offers a tremendous depth of resource material. A site visitor will find articles there that explain the basics of life insurance premium financing. This premium finance material is geared towards the person just learning about premium financing. In addition, they also provide step-by-step guidance to help the site visitor understand the financing process from start to finish.
A unique and timesaving feature of this website is their interactive inquiry tool. Miller explained how it works: "Suppose, for example, that you are looking for Arizona premium financing specialists in your area. You will input some contact information. Also indicate the best time to contact you, as well as your state and also indicate the wealth transfer amount that you would like to make available. You click one button and you will be contacted, by telephone, by a licensed insurance broker, who is trained and experienced in setting up premium financing arrangements. They will do the legwork for you, and find you the best policy for you at the lowest possible cost. It really couldn't be any easier."
According to Miller, the ideal candidate will usually be earning a minimum of $100,000 per year, and they will have a net worth of at least 2 million dollars. "In most cases, these types of policies will allow the policy holder to pay off their premium loan after two years. Either they can pay off the loan in full in order to continue their insurance coverage, or they can terminate the policy. Policies like this are designed for those people who need long-term protection, but who don't have the time or know-how to secure a policy or financing for themselves. It is a solution that works well for busy people who have significant assets to protect. Our site is a tool and resource that everyone can benefit from."
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