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Life Insurance for Business

Life Insurance for Business
Life insurance can have many uses for a business owner, from rewarding key employees to protecting the financial security of your organization. Choosing the right insurance options can be one of the most important decisions you will make in building and operating a successful business.

What type of life insurance is right for your organization? Here are the facts:

There are many different types of life insurance, each with its own unique purpose and benefits. Some of the most important types are:

  • Executive group life insurance can help an employer cover their executives and other key employees. These plans are designed to reward your most important team members, which can lead to an increased sense of loyalty from the employees that matter the most to your organization.
  • Corporate-owned life insurance can be used to help insure the lives of employees who are essential to the operation of a business. It can also be used as a way to fund retirement benefits.
  • Term insurance can be a cost-effective way to cover your employees’ immediate insurance needs, while giving them the opportunity to convert to a permanent insurance plan in the future.
  • Whole life insurance offers the most guarantees of any kind of life insurance. The premiums will never increase. The death benefit will never go down. In addition, whole life insurance policies have a guaranteed cash value, which can be borrowed against. This living benefit can be used as emergency fund or to supplement retirement income.
  • Universal life insurance provides a guaranteed death benefit while also offering flexibility with premiums. The policy holder can vary the amount paid each month, as long there is enough money in the account to pay for certain minimum insurance and maintenance charges. Depending on how much money accumulates in the account, the policy may also accumulate tax-deferred cash value.
  • Variable life insurance allows a high degree of flexibility with premiums, including the option to direct a portion of premium payments to a separate account, which can serve an investment vehicle. This can allow for the possibility of greater growth in cash value, but it can also entail a greater risk.

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