{"id":19132,"date":"2020-07-21T07:50:07","date_gmt":"2020-07-21T11:50:07","guid":{"rendered":"https:\/\/insurancenewsnet.com\/?post_type=innarticle&p=5660386"},"modified":"2020-07-21T07:50:07","modified_gmt":"2020-07-21T11:50:07","slug":"life-insurance-can-be-the-key-to-preserving-family-wealth","status":"publish","type":"post","link":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/2020\/07\/21\/life-insurance-can-be-the-key-to-preserving-family-wealth\/","title":{"rendered":"Life Insurance Can Be The Key To Preserving Family Wealth"},"content":{"rendered":"


\n<\/span>
\n<\/span>
\n<\/span>
\n<\/span>
\n<\/span><\/p>\n

\n

By Brandi Graver and H. Lillian Vogl<\/strong><\/p>\n

What can people pass on to their loved ones if something were to happen to them suddenly? It depends on the day and, in some cases, the hour. Recent events have many clients concerned about the stability of their wealth, not only for their own benefit, but also for their legacy beneficiaries.<\/p>\n

If you have clients who are concerned about what market volatility might mean for their loved ones, life insurance can provide peace of mind that generational wealth won\u2019t get lost in the storms.<\/p>\n

The Market<\/strong><\/h3>\n

Business owners and others with highly concentrated positions are particularly susceptible to \u201closing it all.\u201d Even investors well diversified in equities \u2013 in which timing is everything \u2013 can experience significant losses in their portfolios because, in some cases, they can\u2019t control the timing.<\/p>\n

There\u2019s an old saying, \u201cDon\u2019t put all your eggs in one basket.\u201d Many investors are familiar with the concept of diversification, and usually try to spread their wealth among different traditional asset classes, including cash, certificates of deposit, money market accounts, stocks and stock options, bonds, real estate, commodities or other tangible assets. Different assets are subject to different risks and have different potential rates of return.<\/p>\n

\n
Advertisement<\/div>\n
<\/a><\/div>\n<\/div>\n

Where Life Insurance Fits<\/strong><\/h3>\n

Life insurance is a financial instrument that is increasingly recognized as a distinctive asset class that can further diversify a person\u2019s total wealth portfolio. The value of the death benefit in a life insurance policy can bring stability to a client\u2019s family protection and legacy goals. Depending on the type of life insurance, its value may be wholly uncorrelated with equity and debt markets, or it may have some correlation but its volatility is reduced by contractual guarantees.<\/p>\n

Note that some life insurance policies also accumulate significant cash value, which may also diversify the sources of liquidity that are available during the client\u2019s lifetime. This makes life insurance highly effective for reducing volatility.<\/p>\n

There are several potential advantages of life insurance as an asset in a client\u2019s portfolio:<\/p>\n