Immediate Financing Arrangement (IFA)
An Immediate Financing Arrangement is an advanced permanent insurance planning strategy used for high net worth clientele. It is generally used in the following situations:
- To facilitate the purchase of needed permanent life insurance for a client who would otherwise forego the insurance to pursue business or investment opportunities instead
- To increase the rate of return on an estate planning strategy which incorporates permanent life insurance
- To increase the size of the Capital Dividend Account which will be created upon the death of the life insured
- To make it possible for a client with one or more existing permanent insurance policies which are not self-funding to begin borrowing against the CSV of those policies for the purpose of making investments
- To make a charitable gift without adversely affecting cash flow or adversely affecting a client’s capacity to pursue an investment opportunity
Corporate Insured Retirement Program (IRP)
The Corporate Insured Retirement Program is a financial planning strategy designed to meet the need for life insurance protection today and access to tax-advantaged cash in the future.
Critical Illness Split Dollar Strategy
The Split Dollar Critical Illness insurance concept is a strategy whereby a corporation and shareholder or employee purchase a critical illness insurance policy and enter into a split dollar agreement. A split dollar arrangement is a formal legal agreement entered into between the parties that specifies: the ownership of each interest in the policy, the sharing of the rights, benefits and obligations associated with the policy, and the allocation of the premium costs associated with the policy.
Disability Buy / Sell Insurance
Disability Buy/Sell Insurance allows a company to continue operating if one of the owners becomes disabled. The disability buy-sell policy would provide funds for another owner to purchase the disabled insured’s share of the company. The amount of the benefit is determined by the value of the company.
Business Overhead Expense Coverage (BOE)
Business Overhead Expense Coverage provides monthly payments to cover the operating expenses of a business for an owner has become totally or partially disabled. The premiums for this type of disability coverage can be tax deductible .
Health Spending Accounts
Health Spending Accounts are based on the idea of a trust. Employers agree to contribute up to a pre-determined annual maximum amount on behalf of each employee. The employee is then reimbursed for eligible dental and Extended Health Benefit expenses. The employees are free to determine what they use their benefit for, restricted only by the benefit maximum.
Group Insurance Coverage (for employees)
Group Insurance Coverage is supplemental coverage offered to employees to better ensure their physical, mental and financial health for themselves and their families. Group insurance is beneficial to employers as they will foster retention, maintain productivity and protect their investment in their employees.
A Whole Life insurance contract includes both insurance and investment components. The investment component cash values add up over time and can be used for wealth accumulation. Whole Life is a permanent life insurance policy and pays out a predetermined, guaranteed amount when the insured individual dies. Universal Life insurance is a flexible policy which offers a lower cost of life insurance as well as an investment element in order to build cash value. This cash value can be used to help pay premiums once there is enough accumulated savings in the policy.
Disability insurance offers a monthly income benefit to an individual in case of illness or injury. In Canada, 1 in 3 people, on average, will be disabled for 90 days or longer at least once before age 65. The average length of a disability that lasts over 90 days is 2.9 years.
A personally owned disability policy is beneficial if your employers group plan does not include this coverage. It can also be used to supplement your employers plan or a government program such as WCB.
Critical Illness Insurance
Critical illness insurance will pay a lump sum tax free benefit to an insured who is diagnosed with a specified illness or condition covered by the policy. Many major illnesses are covered, including cancer, heart attack and stroke, however, coverage may be available for more than 26 covered conditions. Certain Critical Illness contracts will also allow a 100% refund of all premiums paid after a designated number of years if the insured does not claim under the policy. Critical Illness insurance helps to prevent unnecessary financial strain on a family and provides for more choice in treatment and care.
Segregated Funds (Estate planning with investments)
A Segregated Fund is a type of investment fund used by Canadian insurance companies to manage individual, variable annuity insurance products. A segregated fund offers investors a variety of unique features, including maturity guarantees, death benefits and creditor protection.