Article 4
Applying Company/Corporate-Owned Life Insurance to a Real-life Scenario
A successful entrepreneur recognized the need for a substantial amount of permanent life insurance but hesitated to use funds from her business to pay the premiums. Given that she was earning approximately 23% ROI on the funds utilized in his business, she understandably hesitated to reduce her income for life insurance expenses.
We arranged adequate life insurance coverage and structured an IFA that covered 100% of the insurance premiums. As a result, she continues investing her own money in her business, rather than allocating it only towards insurance premiums.
The effective net cost of his life insurance amounts to only the tax-deductible interest, representing less than 4% of the true premium.
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