April 1, 2017
Where life insurance planning is in place, cash benefits can provide significant capital providing financial solutions. A cash benefit can redeem a business owner’s share value upon death, and if there are partners, it can provide the funds necessary to enable improvements and the transition when taking over the business. Debts can be redeemed, and key-man insurance can ensure that there are funds available to sustain the transition or expansion.
A few things life insurance can achieve:
- Create beneficiary payments to equalise your estate. For example, if a farm bequeaths to the eldest son, life insurance can distribute guaranteed funds to the remaining children and a surviving spouse.
- Pay off potential estate capital gains taxes and debt, which otherwise might deflate your estate or leave liabilities associated with a business.
- Capitalise the expense of keeping a second property such as the cottage in the family. Life insurance can pay off huge taxes and remaining mortgages.
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