High-value life insurance is a secure and unique insurance plan especially designed for high net worth individuals like yourself who are business partners, directors, and large business owners, having large illiquid assets such as large real estate investments, machinery, accounts receivables, etc. This type of life insurance plan provides massive amounts of coverage from USD 1 million up to USD 200 million. It provides the opportunity for you to develop a very large asset base and offers guaranteed minimum accumulation benefit protecting you from market fluctuations. In a nutshell, life Insurance for HNWIs/UHNWIs is recommended so that they / their families/businesses continue to run at the same level of comfort and guarantees that they are used to.
Why should high net worth individuals buy high value life insurance policy?
As an HNWI/UHNWI individual, your needs are unique and hence only bespoke solutions are appropriate for you. These high-value insurance plans can be designed to meet your individual needs. Some of the reasons why one should consider a high-value life insurance policy are as follows:
High-value life insurance can help your business when insurance is taken on all the partners or keyman and the company pays for it. In the event of a claim, claim proceeds come to the business and can be used by the surviving partner to pay to the deceased partner’s successors towards buy out of his share in the business. In this way, there is no cash stress on the business to pay off the deceased partner’s family and continue running the business. In a sole proprietorship business, the family gets liquidity in the business and is not having to rush to sell the assets to pay running expenses or short-term/long-term liabilities. The cash payout helps the business to remain stable and gives time to the family to consolidate the business and carry on profitably.
Structuring Tax and Other Liabilities
It is vital for you to make sure that your estate has the liquidity to pay debts and estate taxes. In case the estate is expected to exceed the exemption amounts, planning for tax liabilities becomes important because paying off federal tax can be cumbersome and is typically due within the year of the estate holder’s death date. High-value life insurance can play a vital role in paying off estate taxes.
Legacy and Estate Planning
Estate planning is not only about estate tax avoidance/reduction, but it is also about taking care of family, dependents, and dealing with complications of transferring business, real estate, privacy protection, creditor protection, probate cost avoidance, and so on. A high-Value policy helps you fairly divide your assets amongst your successors. For example, if one of the children is not interested in joining the business, then life insurance proceeds can go to him/her and another child gets full control of the business. Legacy planning involves a lot more than estate planning. Rather than planning for “when I am dead”, it involves developing plans for things you value, the beliefs you have, the people you love, and passing all these to successive generations. A high-value life insurance can help you realize these plans in a much better way by providing the financial security you need. Apart from this, keyman protection, wealth preservation, and charitable giving are also other key objectives of buying jumbo life insurance. To conclude…
The very definition of rich implies that one is wealthy and has a great deal of money or assets. And that is typically the reason why a high net worth individual, like yourself, might undermine the importance and need for life insurance. You may assume that you already have enough wealth to protect your business and family, in case of your sudden demise or a slowdown of business due to a critical illness that you may suffer from. However, as experience has shown us and hopefully, we have been able to convince you, that is not always the case. A jumbo life insurance policy plays a very important role in estate planning as well as providing immediate liquidity to your family and/or business in case of your death or if you are diagnosed with a critical illness. Our wealth of experience in this domain will ensure that you, your assets, and aspirations are well protected and transferred onto future generations or executed as you wished it to be. To learn more about high-value life insurance, please contact us at firstname.lastname@example.org
So, you have decided on getting life insurance for your loved ones. Fantastic! Now it is time to get into the details and learn about “Riders.”
Riders are optional add-on coverages that you can tag on to your basic life insurance policy. Riders bring customizability to the world of insurance policies. With Riders, you can tailor the insurance policy to meet your specific needs. You can add certain benefits or limit certain aspects of your insurance policy and they only cost a fraction of the life insurance policy.
Like life insurance policies themselves, the Riders and their associated perks differ from insurer to insurer. Hence, it is always advisable to study the specific Riders offered by various insurance providers before committing to any.
Most Popular Life Insurance Riders
Now we come to the most important bit where we will discuss the different Riders that one can choose from depending on one’s needs:
Critical Illness Rider: This is one of the most sought-after benefit as lifestyle diseases are on the rise. This rider provides monetary support in case the policyholder is diagnosed with one of the listed critical illnesses such as multiple sclerosis, heart disease, cancer etc. A lump sum, as per the policy, will be granted to the policyholder regardless of the total amount required for the treatment.
Hospitalization Benefit: This Rider provides for medical and non-medical expenses for the policyholder in the event of hospitalization. A fixed benefit on a per diem basis will be issued by the insurance company. Most insurance companies typically require a minimum number of days at the hospital before this benefit kicks in.
Term Conversion Rider: Normally, Term life insurance policy only covers for a limited amount of time, ranging from 10 to 30 years. However, when the policyholder goes to get another policy, the holder may not get the same coverage benefits that they had. This arises due to the fact that the medical checkup may not make the policyholder eligible for the same benefits that they had while they were 10 or 30 years younger. Term conversion rider helps the policyholder to convert existing term life insurance to permanent life insurance without requiring a medical exam.
Permanent and Total Disability benefit: This is a living benefit wherein if an insured becomes permanently totally disabled, a lump sum is paid out to the policy holder. This benefit helps the family to cover the loss of income and bear the necessary expenses that comes with a disability. The life cover sum will not be reduced if a valid claim for PTD is presented.
Accelerated Death Benefit Rider: This rider provides a portion of the death benefit coverage for the medical bills of the policyholder if s/he is diagnosed with a terminal illness. This is very helpful for covering immediate medical bills and enabling the insured to live his or her last days with dignity.
Family Benefit Income Rider: In addition to the lump-sum an insurance policy provides to the insured’s beneficiary, this Rider provides the family of the policyholder with regular monthly income after the death of the policyholder for a certain pre-determined period of time.
Waiver of Premium Benefit: This rider helps with writing off future premiums of a policyholder if they are totally incapacitated due to a terminal illness or accident as stated within the policy conditions. The policy will continue without requiring premiums to be paid by the policyholder or policy owner.
Dismemberment Benefit: Provides the policyholder with a lump sum if they suffer a loss of limb or sight due to an accident, as stated within the policy conditions.
What riders should you pick?!
Riders are a great way to get additional benefits from a life insurance policy without having to pay the hefty premiums for stand-alone policies covering those same benefits. However, not all riders are for everyone.
Experts from New Age Insurance Brokers are here to guide you through the entire process. We partner with all major life insurance companies in Dubai to provide the right cover for you. Contact us at +971 4 3573378 or email us at email@example.com to know more.
“Life insurance is the last thing that comes to my mind when planning for the future; after all, there are a lot of attractive investment options including investments in bullion, stocks and mutual funds. Why should I invest in life insurance now, when I am active, hale and hearty?”
Sounds like what you or your friends would say about life insurance?
Especially when we are living longer and longer, there is a genuine question around why one needs life insurance. Let us explore the four reasons why we believe millennials need life insurance now more than ever before. Read along.
Sure – You don’t want your family to reel under debts that you procured?
As you grow older, you might acquire some form of a loan or the other. It could be an education loan, some have car loans, some have home loans etc. Due to an untimely death, the burden of these loans can fall on your family: old parents or your spouse and children, as the case may be. A life insurance policy will prevent your family from being saddled with loans they may not have planned for, and possibly cause their financial ruin.
Ensure your family’s dignified living even after death
Life insurance is an income replacement tool. Your income helps run the household, pay for education and healthcare and even help build a kitty for retirement and medical expenses that come with old age. Your untimely departure will jeopardize your family’s ability to sustain the same or a reasonable standard of living as expenses will continue but the incomes supporting that would have stopped.
Even in the case of a non-earning member of the family, there is a financial value that is attached to all the work that the spouse takes on and is responsible for. If the spouse meets an untimely departure, you should expect expenses related to child care, care of the elderly and running of the household to dramatically increase.
Thus, life insurance helps your family to lead a respectable life in case you are not around.
Employer’s Insurance – Is it enough?
Group Life Insurance plans are only now coming into vogue in the UAE. However, even if you are employer provides this benefit, these life insurance plans remain alive as long as you are employed with that particular employer. If you leave the job or are laid off, you are automatically removed from these Group Life Insurance plans.
Additionally, workplace coverage may be more than enough as long you have no dependents. But if you have dependent parents or need to financially take care of your spouse and children, then the employer’s insurance policies typically fall short.
Cannot afford it? Think again
One of the common misconceptions surrounding life insurance is that the cost of getting insured is high.
Yes, that can be true in some circumstances but if you are young and healthy, premiums can be as cheap as a cup of coffee a day! Unfortunately, when we are young and healthy, we assume we will always remain healthy. But health deteriorates over time, accidents do happen and we are susceptible to genetic health risks. It has been rightly said, “Good health buys you life insurance and money only pays for it” So the right time to buy life insurance is precisely when you are young and healthy.
Still unsure about getting life insurance? We understand the hesitation and perhaps you have a lot of questions that you need to be answered before you are able to make up your mind on this one. Our qualified professionals at New Age Insurance Brokers believe in educating our clients and can help draw out a financial plan that will work for you. As a leading insurance broker in UAE, having tie-ups with the most insurance companies in UAE, we will work with you to secure your future. You can e-mail us at firstname.lastname@example.org or call us at 04-357 3378 for a free financial health check-up.