Talk:Premium financing

Casualty insurance premium financing differs from life insurance premium financing in that casualty policies are secured by the unearned premium in the policy, and the types of life insurance policies that can be financed (universal, equity indexed universal and whole life policies, not term policies) are usually secured by accumulating cash values earning interest.

If a casualty policy lapses through non payment of premium payments by insured, the unearned premium in the policy is refunded to the premium finance company. Thus, the entire premium may be financed.

Life insurance policies do not have any unearned premium, but have cash values, which accrue to the benefit of the insured. A life premium finance company can only obtain the cash value of the policy as collateral if the insured either transfers ownership of the policy to the premium finance company, or lists them as a beneficiary on the policy with respect to the policy death proceeds.

This casualty premium finance is widely used by business owners, whereas life premium finance is used mainly by high net worth senior individuals seeking to provide their estates with liquidity. 68.98.141.179 (talk) 03:31, 23 February 2008 (UTC)