COLLATERAL ASSIGNMENT OF LIFE INSURANCE

Life insurance as collateral security is an essential tool for securing creditor interests and ensuring business continuity in the event of the death or disability of the owner or a key executive.

Benefits and challenges:

· Creditor security: Allows lenders to obtain additional security for loans granted.

· Asset preservation: Avoids forced liquidation of business assets by guaranteeing debt repayment.

· Heir protection: Ensures that the company's financial commitments do not become a burden on the estate.

· Tax optimization: The insurance proceeds are generally tax-free and can be used to cover the company's financial obligations.

Pledging the insurance policy:

The cash surrender value or death benefit is primarily allocated to debt repayment. Once the financial obligations are settled, the balance is paid to the designated beneficiaries.

This requirement is commonly requested by banks and private investors when financing businesses.

Through a personalized analysis, LMB Insurance Inc. assists companies in evaluating and implementing tailored solutions, ensuring optimal protection against financial risks.

Contact LMB Insurance Inc. today for a specialized consultation.