Premium financing involves the lending of funds to a person or company to cover the cost of an insurance premium. Premium finance loans are often provided either by banks or by third party finance entities known as a premium financing company. Typically, clients that engage in this transaction range in age from 29 to 75; with a net worth of $3,000,000 or greater. Younger clients benefit in the current environment due to the advent of premium financed indexed universal life(IUL)policies. The growth inside IUL policies often exceed the interest rates charged on the loan resulting in a positive arbitrage. Premium financed policies can be used in a number of ways, including:

• As a buy/sell agreement
• As part of a Gifting Strategy (Leveraged Gifting)
• Inside an Employee Stock Ownership Plan (Leveraged ESOP)