Success Stories

JMBI is dedicated to our clients’ success. Our expertise, insights and focused action are fundamental to delivering real results for your business.

Read our client success stories to see how we help clients reach their goals and maximize financial and operational performance.

Private Client

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RESPONDING TO UPDATED OBJECTIVES - FINANCIAL SOLUTIONS

Situation

We consulted with a long-time client to review a portfolio of trust-owned life insurance policies.  The review showed the need to align her coverage with her current financial situation and consider the opportunity for future generations.  The trust-owned policies had significant cash values and unrealized gains. We discussed eliminating or minimizing future premiums, improving access to policy cash values, avoiding current and future taxation on the unrealized gains, and maintaining the existing coverage amounts. It was also important that we weighed the impact of the discontinuance of premium payments into the existing policies which would result in decreased death benefits.

Insight

The multiple goals required of the life insurance portfolio required a mixture of state of the art products as no single product could meet all of the criteria. Our approach was to design multiple portfolios with varying elements of liquidity, death benefit guarantees, and potential for cash accumulation to meet this client’s needs.

Action

We presented four (4) options to the client and her advisor. With our counsel, the client chose a portfolio of two products; one with a death benefit orientation and long-term guarantees and another with a cash value accumulation orientation and the potential for death benefit growth. We worked closely with our carrier relationships resulting in both policies being issued at the best available underwriting class.

Results

The client’s needs were met, especially the need for flexibility and a lower out of pocket outlay as her financial situation had changed from when the original coverage was selected. The new life insurance portfolio eliminated the need for ongoing premium payments while maintaining the existing death benefit. Through the usage of 1035 exchanges, the movement of the cash values from the old policies to the new policies did not result in the recognition of any taxable gain. Access to the policy cash values was improved, and the life insurance portfolio has the potential for future growth in the death benefit.  We have also starting to work with the next generation in the family to develop a holistic approach and ensure the security of multiple generations.

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