Life Insurance Death Benefits Offer Business and Fiscal Security
Investing in life insurance provides financial security and peace of mind. However, not many people realize how versatile life insurance policies truly are. Most individuals believe life insurance provides income to the bereaved parties as the loved one who passed on can no longer contribute financially. This is true; however, death benefits, the amount of money paid out when an individual files a life insurance claim, can do much more.
VIP Insurance for Businesses
When a high-ranking executive at a company dies, this can put the business in a difficult situation. For example, replacing CEOs, CIOs, and COOs can take time and cost a company a significant amount of money in the interim. This can put the future of the company in jeopardy, especially if the death was sudden. This is why some businesses invest in “key man” insurance policies on vital employees. This is especially helpful if a company has multiple partners. This type of life insurance policy can cover the taxes associated with transferring ownership of the company to the remaining partners.
Paying Estate Taxes
Large estates usually mean a high amount of taxes. When an estate transfers to heirs, this can create financial headaches. Many assets, such as property, are not easily liquidated. Even so, the IRS taxes them. Heirs may not have the funds to pay the taxes, which can force them to sell treasured heirlooms to cover the expense. It can also create infighting among family members. If one heir can afford the taxes but another cannot, a dispute over whether to sell the property or not is likely to arise. Death benefits can provide the necessary funds to pay the taxes.
The scope of life insurance has evolved over the years. People use life insurance to pay for their children’s education, as a means to optimize their taxes, and more. While the original purpose of life insurance was to provide financial security after the death of the insured, individuals cannot afford to ignore the possibilities death benefits offer. The Reilly Group can help you navigate the different types of life insurance policies available as well as determine which policy will provide the greatest benefits. Contact us today to learn more.