Maximizing Financial Security with Corporate Owned Life Insurance for New Brunswick Business Owners

Corporate Owned Life Insurance (COLI) is a valuable tool for business owners in New Brunswick, Canada, offering financial protection, tax advantages, and various strategies for business planning and resilience. Here are some key points to consider when exploring COLI for your business:

Benefits of Corporate Owned Life Insurance:

- COLI provides financial protection for key employees and ensures business continuity through key person insurance.

- It serves as a strategic tool in business planning, securing funds for various needs and offering benefits to top executives to foster loyalty and retention.

- Acts as a business life insurance strategy, providing financial stability and aiding in long-term planning.

Tax advantages of Corporate Owned Life Insurance:

- COLI offers potential for tax-free proceeds that can be channeled into the capital dividend account and grows inside without being taxed.

- It provides a preferable tax rate compared to other corporate profits and avoids capital gains taxes on policy growth, resulting in significant tax savings.

Financial Strategies for Businesses Using Corporate Owned Life Insurance:

- COLI supports estate planning and buy-sell agreements for smooth succession planning and secures financial resources during transitions.

- Share premium costs with employees through split-dollar life insurance arrangements and protect stakeholders' interests with shareholder agreement insurance.

Different Types of Corporate-Funded Life Insurance Policies:

- Permanent life insurance offers lifelong coverage, while term life insurance provides protection for a specific period.

- Key person insurance protects against losses from the death of essential personnel, and business partner insurance allows for buying out shares if necessary.

- Executive bonus life insurance aids in retaining top talent within the company.

Overall, Corporate Owned Life Insurance is a valuable asset for businesses in New Brunswick, providing financial protection, tax advantages, and various strategies for business planning and resilience. To learn more about how COLI can benefit your business specifically, consider scheduling a complimentary consultation with Mike Plume of Plume Financial for a full financial assessment. Schedule a meeting at https://plumefinancial.ca/meeting.