RIC is a nation-leading independent risk manager partnering with over 200 corporate trustees
We provide independent policy reviews, ILIT administration software https://paydayloansohio.net/cities/lima/, and remediation services for Trust Owned Life Insurance. As we do not market or sell insurance of any kind, our entire focus is on reducing fiduciary risk and helping trustees meet regulatory oversight requirements.
Inadequately funded policies-that is, policies lapsing before maturity or maturing with a significantly reduced death benefit-can compose a significant portion of a trustee’s life insurance portfolio. Clients are often content to “stay the course” with their policies, not wanting to or believing they can make any changes to a policy. As the time horizon to lapse shortens, however, the need to explore options to remediate the funding issues becomes more urgent.
It is natural to wait and focus on remediation options when there is more urgency, but it is prudent to consider these even when the time horizon is much longer, as options may become less attractive or not available as time passes. Not all will be suitable or attractive to your client, but discussing these options with a client may introduce them to possibilities with their policy they did not even know existed.
While not all-encompassing or applicable to every policy or situation, the following strategies are a good place to begin a conversation with a client whose policy in inadequately funded:
Pursuing any one of the below options may “solve” the funding issue, however, a more comprehensive exploration may identify that some options provide more value than others for your client’s particular situation
Many inadequately funded policies are simply a result of no longer funding a policy. …
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