Asterisk Financial Launches Personal Guarantee Insurance&trade, A New Insurance Product Protecting Business Owners from Loan-Related Losses
June 24, 2010
For Immediate Release
Ground-breaking insurance from Asterisk covers a substantial portion of net personal liability in cases of small business loan default and business liquidation
Middletown, CT, June 24, 2010 – Asterisk Financial, Inc. today announced the introduction of Personal Guarantee Insurance™, a new insurance product that protects small-to-medium-size (SMB) business owners, or anyone who guarantees a SMB loan, against major loan-related losses.
For the first time, loan guarantors – including business owners, commercial real estate investors and limited partners – can have a substantial portion of their net liability covered if the underlying business should fail. The concept of Personal Guarantee Insurance is so innovative that Asterisk has applied for a patent for the concept.
Asterisk uses a direct selling approach and is initially licensed to offer Personal Guarantee Insurance™ in Connecticut, Illinois, Indiana, Iowa and Wisconsin, with plans to expand to at least 10 other states in 2010 and 2011.
Today, most SMB owners, limited partners and commercial real estate investors are required to personally guarantee a commercial loan transaction, exposing their personal assets when they take out a business loan. This puts them at risk of losing their home, savings and other personal assets if the business should get into trouble and default on the loan.
Personal Guarantee Insurance from Asterisk assures guarantors that they are protecting their personal assets when they sign a guarantee for a commercial loan.
How Personal Guarantee Insurance Works
If, after liquidating the business assets, the lender seeks personal assets to repay the balance of the loan, Personal Guarantee Insurance will cover a substantial portion of the insured’s net liability, subject to the terms of the policy.
“For years, those taking out business loans have faced the risk of substantial loss of personal property when the value of business assets did not satisfy loan obligations,” said Mark L. Ricciardelli, CEO of Asterisk Financial. “Personal Guarantee Insurance from Asterisk is a unique product designed to address that risk, covering a substantial portion of what is owed after the business liquidation, and thus, reducing the personal exposure to small and medium size business owners and other investors.”The advantages of Personal Guarantee Insurance™ include:
- More conducive to business success: Owners and other loan guarantors retain 100% of a venture’s upside potential while transferring a substantial portion of the downside risk. This changes the equation in terms of business focus and commitment of resources.
- Peace of mind: Some have described the threat of personal loss in a business failure to having a “sword hanging over their head.” Personal Guarantee Insurance removes the anxiety caused by this worst-case “what if” scenario.
- Reduces potential for strain and division among business partners: The potential for severe personal losses from a business failure can lead even amiable partners to wrangle over things like acceptable levels of risk and redistribution of ownership stakes. With the protection of Personal Guarantee Insurance, their personal exposure is substantially reduced, allowing them to remain focused on overcoming business challenges and staying on plan.
Asterisk is led by a seasoned management team with years of experience in insurance, banking and financial services. Ricciardelli is a former CEO with Kohlberg Kravis Roberts & Co. and GE Capital. The other management team members held executive positions at GE Capital, XL Capital, American Express, and Webster Bank
For CT release only: Because of its growth plans in Connecticut, Asterisk has taken advantage of the state’s Job Creation Tax Credit program. The company plans to have approximately 145 employees in Connecticut by 2014.
For more information or to find out about how to apply for Personal Guarantee Insurance from Asterisk, click here www.personalguarantee.com.
About Asterisk Financial Inc.
Asterisk Financial Inc., a wholly-owned subsidiary of Asterisk Financial Group Inc., is the first-to-market creator of Personal Guarantee Insurance, the only insurance product available today that specifically addresses the risk mitigation needs of loan guarantors. Designed as credit insurance, Personal Guarantee Insurance is intended to protect small-to-medium-size business owners, commercial real estate investors and other guarantors from potential liability and property loss arising from personal loan guarantees. Asterisk is headquartered in Middletown, Conn. For more information visit www.personalguarantee.com or call (888) 643 8744.