DECISION SUPPORT SYSTEM AND METHOD FOR PROVIDING A CASH VALUE LIFE INSURANCE POLICY USING REDUCED RISK PREMIUM FINANCE

摘要

Decision support systems and methods are provided for reducing the risk of financing premiums for a cash value life insurance policy. Information including a projected issuance date, a projected third-party loan payoff date, and a projected policy maturity date is used to underwrite an application for the insurance policy. Leverage method steps include determining a third-party loan amount to fund a policy premium. Arbitrage method steps include determining a participating policy loan amount sufficient to provide an early third-party loan exit strategy, thereby significantly reducing durational risk by funding the third-party loan amount at the projected third-party loan payoff date. The participating loan amount may be loaned at a maximum participating loan rate that is less than an interest rate for the third-party loan and/or less than a cash value earnings rate for the policy. Tax benefit methods steps may include scheduling periodic policy loan distributions.