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Guardian’s BRT Designed to Bring Small Business Owners, Banks to the Table
{ts '2008-11-18 00:00:00.000'}

For media inquiries, contact:
Wendy Webster Coakley
Tel: 413.395.4467
Fax: 413.395.5986 wendy_coakley@berkshirelife.com
Anayo Afolabi
Tel: 212.598.8329
Fax: 212.919.2790 anayo_afolabi@glic.com

NEW YORK, N.Y., November 18, 2008 — A unique financial protection offering from The Guardian Life Insurance Company of America (Guardian) can make it easier for start-up enterprises to secure the commercial loans they need to grow their businesses.
Available only from Guardian—and administered by its wholly owned stock subsidiary, Berkshire Life Insurance Company of America (Berkshire)—the Business Reducing Term (BRT) policy was specifically designed to fund financial obligations that require periodic payments expiring at a given time. It insures up to 100% of monthly loan payments (principal and interest, provided the obligation rests with a single principal) should a business owner become totally disabled.
Because a BRT policy can be structured to coordinate precisely with the term and amount of the loan—from five to 30 years, and for as much as $22,500 per month—and because the bank or credit union is named as the loss payee on the policy, having this coverage in place is a win-win for the small business owner and lending institution alike.
"Despite the personal investment new business owners make in their fledgling enterprises, they often have difficulty getting commercial loans for critical capital needs, especially in this uncertain economy," said Susan B. LeBourdais, Berkshire’s Director of Growth Segment Marketing.

"Having this protection in place can make it easier for banks to say ‘yes’ when they might otherwise have said ‘no,’" she added.
How Does It Work?
As long as they can still run their businesses, owners can repay any loan that they take out from the earnings of the business. If they die, life insurance can pay. But if they become totally disabled due to sickness or injury and can’t work—a more likely scenario than dying prematurely for most entrepreneurs—their business assets and good credit rating could be lost due to loan forfeiture.
Through BRT coverage, business owners can insure against a disability preventing them from meeting such fixed payment obligations as:
  • The funding of medium-term loans dependent upon the business talents of a key individual for their repayment;
  • Purchase agreements;
  • Salary contract guarantees; and
  • Contract performance guarantees.
Business Reducing Term disability insurance is similar to decreasing term life insurance in that the total coverage reduces over time. However, while the face amount of a decreasing term life policy diminishes, the BRT monthly benefit will always be the same. Only the number of months payable will be reduced.
For example, if a business owner becomes disabled, his or her BRT policy for a $1,000 monthly benefit will pay the bank $1,000 a month until the term ends (or until the business owner recovers).

Solving the Liability/Asset Mismatch
This loan-specific coverage provides important peace-of-mind for busy entrepreneurs, even those who think they may be covered by more traditional Overhead Expense (OE) insurance, which provides reimbursement for operating expenses like rent or utilities when a disability occurs.
"Overhead Expense insurance provides vital coverage for business owners in the immediate aftermath of a disability—and we offer it at Guardian—but it was never designed to cover long-term obligations," said Berkshire’s LeBourdais, adding that the typical OE benefit period is 12, 18 or 24 months, much shorter than the repayment duration of most bank loans.
Plus, by protecting their fixed obligations with BRT, business owners can find more room in their OE policies to cover other growing expenses, she noted.

Plus, by protecting their fixed obligations with BRT, business owners can find more room in their OE policies to cover other growing expenses, she noted.
"At a time when the nation’s financial landscape remains uncertain, insurance professionals are in a unique position to offer their business-owner clients a product with which no other company can compete, one that addresses the needs of commercial lenders as well," LeBourdais concluded. "In doing so, we are signaling Guardian’s long-term commitment to two key sectors of the U.S. economy—small businesses and banks."
For information about how BRT works, contact the nearest Guardian agency via www.GuardianLife.com/service_center/find_a_local_office.html. Each agency is staffed with at least one Disability Income Specialist, who provides local sales support and service for disability income insurance cases. Product availability varies by state. Policy Form AH55-A provided by The Guardian Life Insurance Company of America, New York, N.Y.

About Guardian
Founded in 1860, The Guardian Life Insurance Company of America, New York, NY (Guardian) is one of the largest mutual life insurance companies in the United States. As of December 31, 2007, Guardian and its subsidiaries had $41.3 billion in assets (on a consolidated statutory basis). With close to 3,000 financial representatives and 80 agencies nationwide, Guardian and its subsidiaries protect individuals, small business owners, and their employees with life, disability, health, long-term care, and dental insurance products, and offer 401(k), annuities, and other financial products and trust services. Specializing in the small to mid-size business market, Guardian's Group business unit serves more than 120,000 employers, 6 million employees, and their families. More information about Guardian can be obtained at: www.GuardianLife.com.

About Berkshire
Berkshire Life Insurance Company of America, Pittsfield, Mass. (Berkshire), is a wholly owned stock subsidiary of The Guardian Life Insurance Company of America, New York, N.Y. Its key missions are to grow Guardian’s individual disability income and long-term care lines of business and to research and develop new insurance products. More information about Berkshire can be obtained at www.BerkshireLife.com.

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