• Life Insurance Types
• Life Insurance Coverage
• Purposes of Life Insurance

Purposes of Life Insurance

Life insurance is used in many personal, business and charitable contexts. Some of the most common uses of life insurance are:

Business Life Insurance

• Key Employee: provide funds to aid in the search for a replacement in the event of death of a key employee.
• Executive Recruitment and Retention: used to provide a variety of non-qualified benefit programs to help attract and retain key employees.
• Business Continuation: provide funds to aid in the continuation of business in the event of death of a key revenue generator
• Succession Planning: provides liquidity to purchase the ownership interest of a deceased owner.
• Debt Protection: creates a pool of money that can be used to pay off lines of credit.

Personal Life Insurance

• Family Protection: provides a source of cash for surviving family members to utilize for living expenses.
• College Funding: provides a funding source for college education of children or grandchildren.
• Debt Protection: generates cash to pay off an existing mortgage or other personal debt.
• Wealth Creation: provides funds to leave as an inheritance or to equalize inheritances among family members.
• Estate Tax Liquidity: creates liquidity to pay estate taxes rather than requiring liquidation of existing estate assets.
• Gifting Leverage: leverages the use of the annual gift tax exclusion, the applicable exclusion, and/or Generation Skipping Transfer Tax exemption.

Charity Life Insurance

• Wealth Replacement: used with many charitable gifting programs to replace for heirs the value of estate assets that were gifted to charity.
• Gift Creation: used to create a significant donation to charity at death.
• Gift Leverage: used to maximize the eventual charitable donation at the death of the insured.