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Gelinas Financial Group, Inc.

LISTEN, UNDERSTAND, RESEARCH, HELP. Money management has a new reality. Financial-planning efforts must consider “the whole client.” We offer a multi layer approach that starts with education. We strive to gain your trust then deliver the results you seek. At Gelinas Financial Group, Inc., our passion is supporting our clients by adding value: You need information to make correct decisions. We’ll help you achieve higher levels of success and better process management through cutting-edge solutions, training, mentoring, and continuing education. Our objectivity and independence mean you get the financial-planning and risk-management solutions that meet the unique demands of your present situation. We offer our expertise in the following areas: Financial Planning Retirement Planning Insurance Investment Coaching Annuities More Hope is not a strategy. We meet with our clients regularly to scrutinize their investments and make adjustments.

Key man or term life: Which option works best

Shawna Kreis Shawna Kreis , 2/11/2015
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Gelinas Financial Group, Inc., GA, Split AnnuitySmall business owners who have a few key employees understand the value of protecting their business by taking out key man insurance. However, in some cases, a term life policy may be the better option for them. Primarily, key man insurance protects a company when a substantial contributor dies while they are still part of the company. This commercial insurance policy pays the company a death benefit which allows them to stay functioning without the player. However, in today's marketplace, when making business insurance decisions, term life may be more beneficial. Key man insurance protects companies from potential financial harm if a significant decision-maker dies while on the job. Premiums are generally higher than those of term-life policies and there are other limitations which may make a term policy a better option. For example, when a key man leaves the company, the business is often saddled with the key man insurance policy. In these cases, they may elect to continue paying premiums (for someone who is no longer there) or they may elect to cancel the policy. Many policies have surrender fees associated with them which makes this financially damaging to the company. Since term life policies are less expensive, and typically last for a specific period of time (10,15 or 20 years) the policy is likely to have a shorter "shelf-life" than a key man policy. When you are considering commercial insurance, it is imperative to look at both short-term and long-term needs. In some cases, a key man insurance policy may be used for a relatively new product called a life settlement. Basically, the company continues to pay the premium and they accept a cash payment for an agreed upon amount. When the insured person dies, the company would receive no additional compensation, the company that paid the settlement would receive the benefit. Each state governs this practice so it is important to investigate thoroughly before you can determine if you may use this option. Another possible option for the company is to offer the policy to the person who was insured. This may entail changing beneficiaries since the primary beneficiary on the these business insurance policies is the company. Once the person accepts the policy, they would pay the premiums and could change the beneficiary. Contact our office for a consultation before you decide to purchase key man insurance to determine whether it is the best option for your company. Content provided by Transformer Marketing.