Shared Ownership Life Insurance


At Tomlinson Alliance Group Financial we have dedicated advisors who solely work with business owners to help them implement Shared Ownership Life Insurance agreements. Utilizing specific tax articles a business owner can purchase low-cost term insurance and assign the ownership and death benefit to his/her corporation. The corporation is protected with life insurance while the shareholder can enjoy building a plan that may grow and exit tax-free.


Here’s how it works:

  • The shareholder applies for a Life Insurance policy.
  • Once approved the Shareholder and the corporation enter into a shared ownership agreement, sharing different aspects of the policy and the premium responsibilities.
  • As shown in the diagram below the corporation would own and become the beneficiary of the death benefit, while the shareholder would own Cash value (savings component).

Other benefits include creditor proofing corporate earnings under the named beneficiary act and also a tax-free death benefit for estate and business succession planning and tax-sheltered growth of corporate retained earnings which are usually taxed at the highest marginal bracket. When the life insurance death benefit is paid out it can also be withdrawn from the corporation virtually tax-free by using the capital dividend account.

If you feel that you are paying too much in taxes and like the idea of a tax-free pension you should be taking advantage of what has been referred to as “The Last Great Tax Shelter”.