For small business owners, not only are they often the “key person” to their business, but they are also key to their family’s current and future financial security. For those business-owner clients who want to plan for business continuity as well as personal financial protection and supplemental retirement needs, a personal key-person solution might be a good option to consider.
Given market volatility and uncertainty, now, more than ever, clients need and want a plan that will protect, provide and preserve business owners’ needs.
A personal key-person solution insures against the loss of the business owner, through the purchase of an individually owned permanent life insurance policy. Let’s take a look at an example:
In addition to the flexibility and the protection afforded by the life insurance, the tax-free benefits, including tax-free death benefit and tax-free access to cash value, enhanced the overall benefit the client was seeking.
Cash value life insurance can help many business-owner clients who have both personal needs and want to protect their business. In short, cash value life insurance offers a solution that “personal key person” clients may be looking for — now, more than ever — to help cover times of financial uncertainty.
This material does not constitute tax, legal, investment or accounting advice and is not intended for use by a taxpayer for the purposes of avoiding any IRS penalty. Comments on taxation are based on tax law current as of the time we produced the material.
Loans and withdrawals will reduce the death benefit, cash surrender value, and may cause the policy to lapse. Lapse or surrender of a policy with a loan may cause the recognition of taxable income. Policies classified as modified endowment contracts may be subject to tax when a loan or withdrawal is made. A federal tax penalty of 10% may also apply if the loan or withdrawal is taken prior to age 59 1/2.
All information and materials provided by John Hancock are to support the marketing and sale of our products and services, and are not intended to be impartial advice or recommendations. John Hancock and its representatives will receive compensation from such sales or services. Anyone interested in these transactions or topics may want to seek advice based on his or her particular circumstances from independent advisors.
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This material is for Agent and Institutional / Broker – Dealer use only. Not for distribution or use with the public.
Insurance products are issued by: John Hancock Life Insurance Company (U.S.A.), Boston, MA 02116 (not licensed in New York) and John Hancock Life Insurance Company of New York, Valhalla, NY 10595. Variable insurance products are offered through John Hancock Distributors LLC through other broker/dealers that have a selling agreement with John Hancock Distributors LLC, 197 Clarendon Street, Boston, MA 02116.
Insurance policies and/or associated riders and features may not be available in all states.
© 2024 John Hancock Life Insurance Company (U.S.A.). All rights reserved.
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