b'to the ILIT, be aware that theres a periodThe remainder of the proceeds go toadvice on an appropriate plan for your practice. of time that must pass before the policy isyour beneficiary. In addition, any time you change ownership of a considered fully owned by the ILIT. This ispolicy, be sure to consult an accountant and a called a lookback period. Other optionsThere are three types of lifelicensed insurance advisor to discuss potential to exclude the policy from your estateinsurance arrangements for a buy-selltransfer-for-value rules that may be in place at may be to have your adult children or aagreement. They are a cross purchasethat time.charity own the policy, depending on yourplan, entity purchase or stock desires for the benefits use. Consult yourredemption plan, and trustee crossLife insurance can be a versatile tool and accountant and attorney. purchase plan. should be implemented knowledgeably by insurance advisors who understand your Business Uses of Life Insurance.In a cross-purchase plan, eachspecific personal and professional needs. There are two main uses for lifebusiness owner is the owner and the insurance in your professional practice.beneficiary of a policy, insuring the life They are to help secure lending or to fundof each of the other owners. a buy-sell agreement. If a bank requiresTreloar & Heisel and Treloar & Heisel Property and life insurance to approve lending, theyIn an entity purchase or stockCasualty are divisions of Treloar & Heisel, Inc.may ask for a collateral assignment ofredemption plan, the entity is theInsurance products are offered through Treloar & a policy. This does not involve a changeowner and beneficiary of a policyHeisel, Inc.in ownership or a change in beneficiary.insuring each owner. The policy would typically be set up as aLastly, theres something called aThis content is intended for general informational personal policy, as usual with your namedtrustee cross-purchase plan, in whichpurposes only and should not be construed as beneficiary. You then sign documentsa trustee is set up to be the owner andadvice. Treloar & Heisel, Inc. does not offer tax or indicating that you are collaterallybeneficiary of a policy insuring eachlegal advice. Please consult with a professional assigning the policy to the lender. Theowner. concerning these topics. way this works is if you were to pass away, the bank gets the balance of whatsWe suggest you consult the attorney owed to them from the death benefits.that created your business entity for AAP Periospectives| 23'