Have you ever considered the possibility of borrowing cash to pay the cost of your insurance premiums?
Sometimes there are scenarios where this option may, in fact, be the best route. Say, for example, a situation where you need the insurance coverage but you don’t want to pay cash. You can still keep cash in hand while covering your insurance costs. This is known as premium financing.
When it comes to factors like your business, your personal assets and your estate planning, insurance is obviously crucial”, says Richard Cayne of Meyer International in Bangkok, Thailand. “Through the option of premium finance, certain individuals and investors can receive the policies that work best for them without it impacting their liquidity”.
What does premium financing cover?
Generally, for those high-net worth individuals who would rather not liquidate their assets for the purpose of covering their premiums, the best option for life insurance is premium financing.
We’re not talking about your average $150,000 policy at 50 bucks a month. We’re talking about thousands and thousands of dollars every month. At that cost, most high-net worth individuals tend to prefer financing their premiums. With this option, they can continue putting their money into investments that are hopefully earning more money than the cost of the interest that’s charged on the loan.
Premium financing is an attractive option for companies that would like to hold their capital for operations. Additionally, instead of monthly premiums, many insurance policies require a lump sum payment. Needless to say, the average company would prefer not to do this.
What premium financing does is provide them the advantage of paying up front and negotiating monthly insurance payments on grounds they’re comfortable with. Also, for high-net worth individuals with family-owned businesses, there are many lenders that are willing to provide premium financing coverage for multiple policies.
Is premium financing for you?
Don’t think that a certain amount of risk doesn’t come with choosing premium financing. Certain considerations need to be made, such as credit ratings, interest rates and collateral values, just to name a few. When renewal time comes, you may find yourself at a disadvantage, as many premium financing options are available at terms shorter than that of the insurance policy itself.
Just to give you one example, let’s say your collateral is a piece of real estate. Should that real estate depreciate in value, the lender may require additional collateral (or may want to change the collateral altogether).
No matter how meticulous you may be in your research on the topic of premium financing, it’s highly recommended that you consult with an expert on the subject, as the variables and options are so many and subject to change. Speaking to a trusted financial expert like Richard Cayne is imperative. He’s been working with premium finance for decades and he can help you navigate the best available options for you and your business.
Richard Meyer Cayne
Richard Meyer Cayne of Asia Wealth Group Holdings, the Meyer Group, Meyer Asset Management and Meyer International Ltd has been involved in wealth management planning for decades. Originally born in Montreal Quebec, Canada, he later relocated to Tokyo, Japan for over 15 years and now resides in Bangkok, Thailand.
While he runs the Meyer Group and serves as the high credibility CEO of Asia Wealth Group Holdings Ltd, a London, UK Stock Exchange-listed Financial Holdings Company, as well as the Managing Director of the Meyer Group of Companies www.meyerjapan.com. and has additionally been the managing director of multiple organizations that specialize in helping high net worth individuals with succession planning .
Having worked with clients all over the globe with everything from portfolios to bonds to mutual funds to offshore investing to investing in retirement for your golden years, Richard Cayne of Meyer International can help you invest the right way and protect your cash. Richard has been a financial advisor involved in wealth management planning solutions and asset management in Asia for over 25 years and while living in Tokyo, Japan, he assisted many high net-worth Japanese families create innovative international tax and wealth management planning solutions.
The financial holding public company of which he is CEO can be seen at Asia Wealth Group Holdings Ltd or the stock exchange link: https://www.aquis.eu/aquis- stock exchange/member?securityidaqse=AWLP Asia Wealth Group Holdings Ltd – Richard Cayne Thailand. Meyer Asset Management Ltd has been in the wealth management space since March 2000 and uses fundamental analysis along with modern portfolio theory.
His image worldwide as a professional advisor has been sterling and he maintains a firm command and understanding of all things finance-related.
