Planning for Life's Unexpected Turns

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As an advisor specializing in high-net-worth life insurance solutions, I've had the privilege of working with countless families and individuals to help them plan for life's unexpected turns. One of the most common concerns I encounter is the fear of an untimely death and the potentially devastating impact it could have on loved ones and hard-earned wealth. It's a sobering reality that none of us are immune to, regardless of our net worth or social standing.

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In my experience, one of the most effective ways to safeguard against the financial risks posed by an untimely death is thorough comprehensive life insurance planning. While life insurance is often viewed simply to replace lost income, it can offer so much more for high-net-worth families. Properly structured, life insurance can act as a powerful risk management tool to protect your client’s assets, ensure their legacy wishes are carried out, and provide a financial safety net for their loved ones.

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Let me illustrate with a real example from my recent casework. I advised an entrepreneur couple in their early 60s with a $75 million net worth tied up significantly in private business interests. Despite their substantial wealth, they had concerns about estate liquidity and ensuring their multi-generational legacy was preserved if one of them passed away unexpectedly.

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After an in-depth look at their situation, I recommended a high cash value Indexed Universal Life (IUL) insurance policy from one of the major Bermuda carriers tailored for high-net-worth clientele. By utilizing a $30 million IUL policy, we were able to create a sizable, protected asset pool. This allowed the client to access liquidity through loans and withdrawals for living expenses. Additionally, in the event of an untimely death, the policy enabled them to pass on the legacy to a designated beneficiary and settle any tax obligations.

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This IUL policy offered them the ability to direct how the cash value was invested. They could choose from the carrier's suite of indexes, essentially allowing them to participate in market-like returns. At the same time, they could still benefit from a guaranteed death benefit that would never decline due to market performance. This provided them with the peace of mind that their protection would be there when needed most.

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The comprehensive solution checked every box - providing a multi-million-dollar death benefit to carry out their legacy plans, cash value accumulation during life to offset potential estate taxes or fund other needs, and diversified investment opportunities with index traced return and minimum rate of return protection. All of this was carefully tailored with an IUL policy specifically designed for families of their net worth calibre.?

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This case exemplifies how we as financial advisors aim to leverage the most cutting-edge life insurance solutions tailored for the high-net-worth space. It's not just about securing coverage for your clients, but about crafting a holistic plan that maximizes the utility and value of life insurance as both a protection and wealth management vehicle.

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Of course, attaining the right life insurance solution requires a personalized approach centred on the client’s unique situation and goals. There is no one-size-fits-all when dealing with high-net-worth clientele and their complex planning needs. As a financial advisor, my role is to immerse myself in the client’s world, ask the right questions, and architect a tailored life insurance strategy that leaves no undue risks while leveraging every benefit possible. We should strive to consistently raise the bar in delivering creative solutions that check all the boxes.

Untimely death is an uncomfortable truth, but one we must all confront proactively in our wealth planning journeys. With foresight and an open mindset toward leveraging life insurance as a potent risk management tool, your clients can secure the future they have worked so hard to build. I've witnessed the tremendous value this can provide first hand, and I consider it an honour to guide high net worth families through this vital planning process.

Debashish Maitra ,

Executive Director, UAE