100% Cost Recovery (CR)
HOW IT WORKS:
In this program, we can either use our First-Dollar Financing (FDF) design, or our Partial-Equity Interest Accrual (PEIA) design.
In premium financing, often times we must start with a much higher face amount that what the client is requesting because after the loan payoff, the net death benefit will decrease... hence we design the policy to achieve a "lowpoint" death benefit in the amount that the client is looking to achieve.
We then begin taking drawdowns from policy values in order to recover the client's outlay, without allowing the policy lowpoint net death benefit to drop below the client's need. We then show a comparison between this design and a non-financed policy with the same level death benefit amount.
Ultimately, they have two life insurance options:
Option 1: Pay the non-financed premiums out-of-pocket.
Option 2: Pay the financed cost and recover 100% of the cost, resulting in a ZERO net cost AND receiving more death benefit.
To watch a video of Darren Sugiyama reviewing an actual case study, click on the icon below: