Cambridge Financing Plan

Premium Financing Done Right:

There's a right way and a wrong way to finance a life insurance policy. Then, there's the best way - the Cambridge Plan.

Life Insurance Premium Financing. It is one of the hottest topics in the life insurance industry - and among the most controversial. In recent years, premium financing has evolved as a valuable tool for high-net-worth individuals to purchase the appropriate amount of life insurance - the amount they need - allowing them to then execute strategies to transfer wealth.

Premium Financing lets clients with significant insurance needs finance payments with little or no out-of-pocket costs and without the need to liquidate high - yielding assets to make policy payments. They can do this by using a combination of their life insurance policies and other assets as collateral.

Premium Financing Done Right:

• Is sold to high net worth consumers who need death benefit as a solution for federal estate taxes and wealth transference planning.
• Is fully transparent with everything disclosed to the life insurance company, who are our partners... not obstacles to circumvent in the financing process.
• There is NO up front payments of any kind. There are NO investors or strangers involved in the program.
• We are approved with the most carriers for premium financing.
• The lender, Cambridge Financing Company, has NO ownership of any kind in the policy if the loan is paid off and will never participate in any manner on the settlement of the policy.
• The intent of the insured is to finance life insurance for death benefit needs, not to sell the policy to generate a profit.
• Legal opinions are issued by nationally recognized law firms for every loan made by lender on insurable interest and the loan structure.

Premium financing allows high net worth individuals to use a combination of the life insurance policy and other assets as collateral for a loan to fund life insurance policies.

Premium financing is typically appropriate for clients:

• With large estates that wish to preserve as much of it as possible for future generations
• With significant insurance needs who desire to finance the payments with little or no out of pocket costs
• Reluctant to liquidate high yielding assets to make policy payments
• Uncertain of the current status of the Federal Estate Tax and wish to hedge their insurability

Traditional premium finance programs require:

• A recourse loan used to finance premiums
• Personal guarantees from the borrowers
• Additional collateral, in excess of the cash value of the policy
• Annual collateral reviews

Client Profile

The requirements for financing are:

• Insured has a legitimate need for life insurance to solve estate planning issues, wealth transference objectives, and financial planning objectives or to protect against other financial losses. The Cambridge financing plan has been created to help wealthy consumers acquire as much life insurance as they need to solve these objectives, using the most favorable financing methods available. We recognize that some consumers are seeking out "free" life insurance by using their policy and/or insurability in a variety of unique ways. These are generally investor driven plans that minimally benefit the Insured's beneficiaries. This is not our market and our financing plans are not designed to satisfy these consumers.
• No investor initiated policies will be accepted; insurable interest tests must be met.
• Insured over 70.
• Insured is a U.S. resident.

The Process

The following steps outline our program:

1. To provide a timely financing quote, we will need CFC Case Submission and Illustration Summary completed along with medical records, illustrations and offers from insurance carriers.
2. We will evaluate the proposed illustrations for the new Policy.
3. If acceptable for financing, a Term Sheet will be prepared that outlines the terms of the loan and loan amount.
4. Upon client approval, closing documents will be prepared.
5. Policy is issued to owner and premiums are paid by lender for the full term of the loan. The policy is collaterally assigned to the Lender for an amount equal to the rolled up premiums and any other costs.
6. At the end of the loan term, policy owner has the following options:

Options At Loan Maturity

At the maturity of the loan, the borrower has the choice of:

• Extending the term of the loan.
• Retaining the policy by paying the loan balance on or before loan maturity and assuming responsibility by paying the future premiums that will come due.
• Investigating settlement options.
• Like any life insurance policy that is financed, the policy owner is under no obligation to pursue any particular course of action at the end of the loan although our typical client is acquiring the policy to facilitate estate planning objectives and/or wealth transference objectives.
• There is no requirement that the client must sell the policy. Our program is designed to keep the policy owned and controlled by the original owner. Cambridge is not involved in the life insurance policy settlement business and our Life Insurance Payment Financing Plan does not require the policy to be settled.

Contact a Life Insurance Concepts Representative Today.

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