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Aurora Capital Alliance is a life insurance premium finance platform, working with advisers and their client across the country with the structure and design of advanced estate and business plans using leveraged premium finance life insurance. This presentations serves as an introduction to the life insurance premium finance concept and how advisers and their clients can get started and learn more about it. Call or visit out website for more information: 888-389-PLAN (7526) [email protected] www.auroracapitalalliance.com
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A Fresh Approach to Life Insurance
Not intended for the public. For producer use only.
A FRESH APPROACH to wealth transfer and retirement planning
No need to liquidate assets to pay life insurance premiums
Not intended for the public. For producer use only.
How do we buy things? Two Ways:
• Pay CASH out-of-pocket-or-
• Borrow money to pay for goods & services
Not intended for the public. For producer use only.
The Rancho Santa Fe Example How do we BUY?
• Pay CASH out-of-pocket-OR-
• Finance the purchase
If we took away the OPTION to finance, who would BUY?
Not intended for the public. For producer use only.
The Rancho Santa Fe Example:◦ $2,000,000 purchase price
Year Cash Option
Financed Alternative @ 3%
Interest Retained CapitalRetained Capital Account @ 5%
1 $2,000,000 $60,000 $1,940,000 $2,037,000
2 $60,000 $1,880,000 $2,138,850
3 $60,000 $1,820,000 $2,245,793
4 $60,000 $1,760,000 $2,358,082
5 $60,000 $1,700,000 $2,475,986
6 $60,000 $1,640,000 $2,599,786
7 $60,000 $1,580,000 $2,729,775
8 $60,000 $1,520,000 $2,866,264
9 $60,000 $1,460,000 $3,009,577
10 $60,000 $1,400,000 $3,160,056
Not intended for the public. For producer use only.
Which would you rather do????
Not intended for the public. For producer use only.
◦ Can we approach life insurance in a similar way?
Not intended for the public. For producer use only.
Why do we buy life insurance? • Cash accumulation potential• Death benefit potential• Combination of both
Not intended for the public. For producer use only.
Did you know? • 80% of life insurance policies never pay a death claim
Top 3 Reasons:• Term policies lapse• Cash value policies are surrendered• Policies are NOT properly funded
Not intended for the public. For producer use only.
What does that mean? • 80% discount on life insurance
Not intended for the public. For producer use only.
How can we WIN? • Properly fund a life insurance policy from the beginning
What are the two ways to do so? • Pay CASH • Borrow Funds
Not intended for the public. For producer use only.
LEVERAGE• Leverage a lender’s capital• Retain use of your own capital for investment opportunities
Not intended for the public. For producer use only.
Not intended for the public. For producer use only.
Two Main Strategies• ACA Legacy Strategy• ACA Retire Strategy Three Levels of Engagement• Exclusive Program• Elite Program• Concierge Program
Not intended for the public. For producer use only.
ACA Retire Strategy Client Profile◦ Age 29 to 55◦ Net worth $5,000,000 or greater◦ Strong cash flow◦ Strong credit◦ Standard health or better
Option for substandard risks
Not intended for the public. For producer use only.
ACA Retire Strategy Benefits◦ Tax-Free Retirement◦ Leveraged life insurance benefit◦ Retained Capital
Not intended for the public. For producer use only.
ACA Retire Strategy How it works• Pay premiums with borrowed funds• Retain use of your own assets• Repay lender from policy proceeds
Not intended for the public. For producer use only.
S&P 500 Performance 5.33% Borrowing Rate 3.00%
Premium Beginning Ending Annual Annual Surrender Collateral Death Retained Retained
Year Age Outlay Loan Balance Loan Balance Interest Out-of-Pocket Value Required Benefit Capital Capital @ 5%
1 39 $369,203 $369,203 $369,203 $11,076 $11,076 $92,857 $276,346 $11,000,000 $358,127 $376,033
2 40 $369,203 $738,406 $736,558 $22,152 $24,000 $459,166 $277,392 $11,000,000 $345,203 $757,298
3 41 $369,203 $1,105,761 $1,114,934 $33,173 $24,000 $854,697 $260,237 $11,000,000 $345,203 $1,157,626
4 42 $369,203 $1,484,137 $1,504,661 $44,524 $24,000 $1,281,746 $222,915 $11,000,000 $345,203 $1,577,971
5 43 $369,203 $1,873,864 $1,906,080 $56,216 $24,000 $1,742,816 $163,264 $11,000,000 $345,203 $2,019,332
6 44 $- $1,906,080 $1,939,262 $57,182 $24,000 $1,912,929 $26,333 $11,000,000 $(24,000) $2,095,099
7 45 $- $1,939,262 $1,973,440 $58,178 $24,000 $2,092,287 $- $11,000,000 $(24,000) $2,174,654
8 46 $- $1,973,440 $2,008,644 $59,203 $24,000 $2,281,561 $- $11,000,000 $(24,000) $2,258,187
9 47 $- $2,008,644 $2,044,903 $60,259 $24,000 $2,481,457 $- $11,000,000 $(24,000) $2,345,896
10 48 $- $2,044,903 $2,082,250 $61,347 $24,000 $2,692,775 $- $11,000,000 $(24,000) $2,437,991
11 49 $- $2,082,250 $2,120,717 $62,467 $24,000 $2,913,431 $- $11,000,000 $(24,000) $2,534,690
12 50 $- $2,120,717 $2,160,339 $63,622 $24,000 $940,267 $- $8,787,357 $(24,000) $2,636,225
Tax-Free Retirement
22 60 $- $- $- $- -$300,000 $3,187,317 $- $12,422,043 $- $2,768,036 23 61 $- $- $- $- -$309,000 $3,264,230 $- $12,751,865 $- $2,906,438
24 62 $- $- $- $- -$318,270 $3,354,200 $- $13,094,817 $- $3,051,760
25 63 $- $- $- $- -$327,818 $3,459,065 $- $13,451,264 $- $3,204,348
26 64 $- $- $- $- -$337,653 $3,580,696 $- $13,822,052 $- $3,364,565
27 65 $- $- $- $- -$347,782 $3,721,107 $- $14,208,338 $- $3,532,793
28 66 $- $- $- $- -$358,216 $3,882,706 $- $14,611,857 $- $3,709,433
29 67 $- $- $- $- -$368,962 $4,067,980 $- $15,034,002 $- $3,894,904
30 68 $- $- $- $- -$380,031 $4,279,539 $- $15,476,549 $- $4,089,650
31 69 $- $- $- $- -$391,432 $4,520,315 $- $15,941,160 $- $4,294,132
32 70 $- $- $- $- -$403,175 $4,793,395 $- $16,429,631 $- $4,508,839
Not intended for the public. For producer use only.
ACA Retire Strategy Exit Strategy◦ From policy proceeds in 12th year
Not intended for the public. For producer use only.
ACA Retire Strategy Retained Capital◦ Retain use of your own assets for other investment opportunities
◦ $1,566,139 in this example
Not intended for the public. For producer use only.
ACA Retire Strategy Tax-Free Retirement◦ Client can realize tax-free retirement
◦ $300,000 per year + inflation protection
Not intended for the public. For producer use only.
ACA Retire Strategy Loan Options◦ Fixed rate & Floating Rate◦ As low as 2.5%◦ Option to raise capital upfront for future years
◦ Potential to defer one or more interest payments
Not intended for the public. For producer use only.
ACA Legacy Strategy Client Profile◦ Age 60 to 85◦ Net worth $5,000,000 or greater◦ Strong credit◦ Standard medical rating or better
Option for substandard risks
Not intended for the public. For producer use only.
ACA Legacy Strategy Benefits◦ Leveraged life insurance benefit◦ Retain use of your own assets◦ Maximize legacy while minimizing opportunity costs
Not intended for the public. For producer use only.
ACA Legacy Strategy How it works• Pay premiums with borrowed funds• Retain use of your own assets• Repay lender from death benefit
Not intended for the public. For producer use only.
S&P 500 Performance 5.33% Borrowing Rate 3.00%
Premium Beginning Ending Annual Annual Surrender Collateral Death Net Death Retained Retained
Year Age Outlay Loan Balance Loan Balance Interest Out-of-Pocket Value Required Benefit Benefit Capital Capital @ 5%
1 67 $964,206 $964,206 $964,206 $28,926 $28,926 $340,704 $623,502 $10,964,206 $10,000,000 $935,280 $982,044
2 68 $964,206 $1,928,412 $1,938,264 $57,852 $48,000 $1,207,350 $730,914 $11,928,412 $9,990,148 $916,206 $1,993,162
3 69 $964,206 $2,902,470 $2,917,544 $87,074 $72,000 $2,127,693 $789,851 $12,892,618 $9,975,074 $892,206 $3,029,637
4 70 $964,206 $3,881,750 $3,890,203 $116,453 $108,000 $3,104,043 $786,160 $13,856,824 $9,966,621 $856,206 $4,080,135
5 71 $964,206 $4,854,409 $4,892,041 $145,632 $108,000 $4,146,289 $745,752 $14,821,030 $9,928,989 $856,206 $5,183,158
6 72 $964,206 $5,856,247 $5,923,935 $175,687 $108,000 $5,331,007 $592,928 $15,785,236 $9,861,301 $856,206 $6,341,332
7 73 $964,206 $6,888,141 $6,986,785 $206,644 $108,000 $6,587,332 $399,453 $16,749,441 $9,762,656 $856,206 $7,557,415
8 74 $- $6,986,785 $7,088,388 $209,604 $108,000 $6,936,673 $151,715 $16,749,441 $9,661,053 $(108,000) $7,821,886
9 75 $- $7,088,388 $7,193,040 $212,652 $108,000 $7,289,735 $- $16,749,441 $9,556,401 $(108,000) $8,099,580
10 76 $- $7,193,040 $7,300,831 $215,791 $108,000 $7,646,174 $- $16,749,441 $9,448,610 $(108,000) $8,391,159
11 77 $- $7,300,831 $7,411,856 $219,025 $108,000 $8,006,663 $- $16,749,441 $9,337,585 $(108,000) $8,697,317
12 78 $- $7,411,856 $7,526,212 $222,356 $108,000 $8,381,037 $- $16,749,441 $9,223,229 $(108,000) $9,018,783
13 79 $- $7,526,212 $7,643,998 $225,786 $108,000 $8,768,385 $- $16,749,441 $9,105,443 $(108,000) $9,356,322
14 80 $- $7,643,998 $7,765,318 $229,320 $108,000 $9,169,657 $- $16,749,441 $8,984,123 $(108,000) $9,710,738
15 81 $- $7,765,318 $7,890,278 $232,960 $108,000 $9,584,658 $- $16,749,441 $8,859,163 $(108,000) $10,082,875
16 82 $- $7,890,278 $8,018,986 $236,708 $108,000 $10,016,831 $- $16,749,441 $8,730,455 $(108,000) $10,473,619
17 83 $- $8,018,986 $8,151,556 $240,570 $108,000 $10,469,173 $- $16,749,441 $8,597,885 $(108,000) $10,883,900
18 84 $- $8,151,556 $8,288,102 $244,547 $108,000 $10,944,468 $- $16,749,441 $8,461,339 $(108,000) $11,314,695
19 85 $- $8,288,102 $8,428,745 $248,643 $108,000 $11,447,003 $- $16,749,441 $8,320,696 $(108,000) $11,767,029
20 86 $- $8,428,745 $8,573,608 $252,862 $108,000 $11,982,869 $- $16,749,441 $8,175,833 $(108,000) $12,241,981
21 87 $- $8,573,608 $8,722,816 $257,208 $108,000 $12,561,144 $- $16,749,441 $8,026,625 $(108,000) $12,740,680
22 88 $- $8,722,816 $8,876,501 $261,684 $108,000 $13,194,762 $- $16,749,441 $7,872,940 $(108,000) $13,264,314
Not intended for the public. For producer use only.
ACA Legacy Strategy Exit Strategy◦ From death benefit proceeds◦ Lender repaid and remainder to beneficiaries
Not intended for the public. For producer use only.
ACA Legacy Strategy Retained Capital◦ Retain use of your own assets for other investment opportunities
◦ $4,548,156 in this example
Not intended for the public. For producer use only.
ACA Legacy Strategy Loan Options◦ Fixed rate & Floating Rate◦ As low as 2.5%◦ Option to raise capital upfront for future years
◦ Potential to defer one or more interest payments
Not intended for the public. For producer use only.
ACA Legacy Strategy Benefits◦ Leveraged life insurance benefit◦ Retain use of your own assets◦ Maximize legacy while minimizing opportunity costs
Not intended for the public. For producer use only.
1. Exclusive Program◦ ACA structures case design◦ ACA structures financing◦ ACA reviews plan on annual basis
2. Elite Program◦ ACA structures case design◦ ACA structures financing◦ ACA reviews plan on annual basis◦ ACA presents in webinar
1. Concierge Program◦ ACA structures case design◦ ACA structures financing◦ ACA reviews plan on annual basis◦ ACA presents and sells plan with advisor
Not intended for the public. For producer use only.
Prospecting◦ Typical client profile
Age 29 to 85 Net worth $3MM or greater The healthier the better Business owners Nonprofits
Not intended for the public. For producer use only.
A different approach to life insurance
Few financial instruments are more misunderstood
Maximize wealth transfer and retirement planning objectives
Not intended for the public. For producer use only.
Leverage a dormant asset Retain use of your assets for your investment opportunities
No need to liquidate assets to pay insurance premiums
Not intended for the public. For producer use only.
Speak with an ACA representative for more information◦ Receive case designs & strategies
(888) 389-PLAN (7526)
[email protected] www.AuroraCapitalAlliance.com
Not intended for the public. For producer use only.
The information provided above is a summary for life insurance agents or financial advisors use only, and is not intended for use by any consumer or potential insured or as a full explanation of an Aurora Capital Alliance, Inc. premium finance program nor is the information provided herein part of the loan documents or financing agreement governing the loan. No insurance agent or broker shall be deemed to represent Aurora Capital Alliance, Inc. or any of their respective affiliates. This presentation should not be relied upon by any person or party in making any decision related to any application for, or purchase or financing of any life insurance policy. Any interested person will be required to consult his or her independent legal, tax and financial advisors prior to entering into any premium financing transaction. Aurora Capital Alliance, Inc. and their representatives make no representations or warranties, express or implied, by any of the above statements. All transactions are subject to lender approval, at its own discretion. Terms and conditions of transactions are subject to change at any time.
Not intended for the public. For producer use only.
A Fresh Approach to Life Insurance
Not intended for the public. For producer use only.