Section: Life Insurance for Business

Life Insurance for Business

Why does a business need life insurance?

Your business is an asset worth protecting, life insurance can be the key to its continued success.

Life insurance can be a powerful tool for business, providing financial solutions with growth opportunities in addition to solid protection from the unexpected. Today's life insurance policies are cost-effective and tax-efficient sources of cash value, both during your lifetime and at death.

For your business needs, life insurance can be used to:

  • Protect business operations from the death of an owner or key employee
  • Provide cash value to help with business ups and downs Repay debts and enhance relationships with creditors
  • Attract, retain and reward key employees
  • Reduce the amount of income and estate taxes that will have to be paid out of business profits
  • Ensure a smooth business transition  upon retirement, disability or death

Life Insurance Offers Added Benefits

In addition to growth potential and protection, life insurance offers a number of  advantages, including:

  • Earnings and gains on policy cash values grow income tax-deferred
  • Cash values, including earnings, can be borrowed income tax-free during lifetime  as long as Policy is not a “modified endowment contract” (MEC) and policy must not be surrendered, lapsed, or otherwise terminated during the lifetime of the insured.
  • Death proceeds are paid income tax-free, and with proper planning, can be free of estate taxes
  • Depending on state law, cash values and death proceeds are generally protected from creditors, lawsuits, etc.

Accessing cash values may result in surrender fees and charges, may require additional premium payments to maintain coverage, and will reduce the death benefit and policy values.

Penn Mutual offers a number of different life insurance policy options designed to fit your changing needs across life's stages.

Contact a Penn Mutual Financial Advisor who can help you determine your needs and choose the right solutions for your business. All information will remain strictly confidential.

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