Life insurance can 'build wealth for generations to come'

Founder of finance group says that everybody can justify owning a policy, no matter how big or small

Life insurance can 'build wealth for generations to come'

Life insurance remains the best, most tax efficient way to build wealth for clients’ next generation, according to an industry insider.

While pressing home its basic concept – life insurance 101, if you will – Chris Karram, founder and chief strategy officer at SafeBridge Financial Group , maintained that everybody can justify owning a policy, however big or small.

Buying into a whole-life product, which is in place for your lifetime, means that, providing you have paid your premiums, your insurance will be there no matter when you pass.

Karram said: “You are ensuring there is a massive lump sum of capital deposited into your family or business account on the death of a significant person, which can do a majority of things like cover tax liabilities or eliminate, potentially, corporate tax in the sense of dividend tax to get out of your corporation.

“It really can set up your next generation in the most tax-efficient way possible - there is no better way of doing so. It can help your family build wealth for generations to come. No matter how big or small that policy is, if that money can be left for your family, your children, your spouse, and in a way that is done so tax free, you really are setting them up for success on a move-forward basis.”

Term insurance, of course, fulfils more short-term needs like mortgages, large income needs or covering off a big business debt. But whole life, and this is something agents and advisors must still emphasize to clients, can be valued at the end of someone’s lifetime, when, rather crudely, they are worth the least and their money is worth the most.

Karram added: “In the end, it doesn't matter if you're just trying to cover off a funeral or if you're just trying to leave $10 million or more to your family. The fact is, if you can get life insurance, cover that debt or cover that responsibility, then why wouldn't you let that company do that for pennies on the dollar instead of using the wealth you've created over your lifetime to then have to cover things off that you'd rather leave to your family.”