This screen provides a graphic illustration to convey the concepts involved in utilizing a policy to make a major capital purchase. |
Let's start with the assumption that we have a permanent life insurance policy that is funded at a level to increase cash value. [click] As cash values increase, death benefits and access to capital will also increase. [click] Once there is sufficient collateral capacity, a policy loan can be taken which is collateralized against the policy cash value. [click] Loan payments are then made to the insurance company providing the loan in order to pay it back. [click] Internal growth and additional contributions are the components that increase collateral capacity. |
No math is presented on this screen. |