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When Life Insurance Impacts the Deal: Considerations for Lenders BY DAN DORAN AND DAVID HILLELSOHN

Dan Doran, CVA, is founder of Quantive Valuations, a certified valuation practice serving privately held businesses nationwide. David Hillelsohn is president of DHill Financial LLC, an independent insurance agency focused exclusively in protection solutions for businesses and the people they support. For more information visit or

Dan Doran

David Hillelsohn




or those of us entrenched in the business valuation experience, there is nothing more satisfying than seeing good deals get done. Taking time to properly assess the value of a project not only reduces the cost to the borrower; it can positively impact some of the ancillary expenses related to the project. One of those ancillary expenses we often see associated with larger transactions is the purchase of life insurance, which can be used to protect the interests of the lender and all parties connected to the borrower and other key members of the transaction. Unfortunately life insurance as a requirement of a loan agreement can be an impediment to closing more business. Commercial lenders should keep these important tips in mind when

broaching the subject of life insurance with existing and potential clients.

Considerations for Commercial Lenders

It’s a positive. Having a life insurance policy or life insurance policies in place on the life of a borrower or a key person to a project should be a positive sign – they value themselves and the people who depend upon them for survival. When considering the credit-worthiness of an applicant, we believe that having existing coverage in place, regardless of type, provides insight into the borrower. The duration of coverage is also relevant. There are many parties involved. Insurance can ensure that the financial responsibilities aren’t left to others who lack the skills or preparation

Banking New England March/April 2017  
Banking New England March/April 2017