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Premium financing life insurance uses borrowed money to pay for life insurance premiums.
This is most often done in conjunction with very large policies (that pay very large death benefits), so that the policy owner does not need to tie up their own capital. Instead, the capital is used as collateral for the loan.
Life insurance premium financing uses borrowed money to fund insurance policy premiums. Those with very large life insurance policies may find this option attractive in lieu of liquidating assetsĀ¹.
(1) Life Insurance Premium Financing: Worth the Risk? - Investopedia. https://www.investopedia.com/insurance/life-insurance-premium-financing-worth-risk/.
(2) Premium Financing For Life Insurance (An Easy How-To Guide). https://abramsinc.com/premium-financing-life-insurance/.
(3) Premium Financing: Leverage for Life Insurance | Lifetime Financial .... https://www.lifetimefinancialgrowth.com/blog/premium-financing-leverage-for-life-insurance.
(4) Life Insurance Premium Financing: What You Need To Know - Forbes. https://www.forbes.com/sites/forbesbusinesscouncil/2020/10/23/life-insurance-premium-financing-what-you-need-to-know/.
(5) Premium Financing: An Option For Disappointed Life Insurance ... - Forbes. https://www.forbes.com/sites/forbesfinancecouncil/2021/07/08/premium-financing-an-option-for-disappointed-life-insurance-policyholders/.