Unlock the hidden value in your life insurance!
You can maintain or substantially improve your financial position by unlocking the hidden value of your unwanted or unaffordable life insurance via a charitable donation. Every year, seniors over the age of 70 lapse or surrender almost $7 billion of insurance that they might otherwise donate to a charity. You can pay down debt, make major purchases or replenish retirement savings by accessing the value you deserve after paying premiums for decades.
Information Packages for Download
|Frequently Asked Questions|
Advantages of Donating a Life Insurance Policy
- You obtain a tax receipt for 10%-50% of the face value of the policy (even for term policies that have no "cash surrender value")
- You convert a "worthless or low cash value policy" into cash in your pocket when you file your income taxes
- Eliminate the burden of annual premium expenses
- A Foundation becomes the owner and beneficiary, and it funds the premuims and collects the benefit upon maturity
Maintain Financial Independence
- Fund retirement living or long-term care expenses through lowered income taxes as a result of the tax receipt
- Reallocate proceeds from the tax receipt and savings to income producing financial assets or annuities
- Reduce or pay off outstanding shares
- Complete application form and provide policy documents and illustration
- Provide medical information
- Determine amount of tax receipt
- Sign ownership transfer documents
- Convert the tax receipt into $$$ in your pocket
Which policies are suitable?
- Term, Whole life, Universal, or Term-to-100 policies
- Insured lives over 70 years old
- In-force greater than 2 years
- Policies between $50,000 and $10 million
For more info, or to get started, call us at 1-800-604-3685
- Proceeds are treated as a disposition for tax purposes and are taxed on excess amount over adjusted cost basis, which includes all premiums paid on the policy less the net cost of pure insurance. Policyholders should seek their own independent professional tax, legal and financial advice.
- A change of ownership of a policy may in the future limit the insured’s ability to purchase additional insurance as a result of limits on how much coverage insurers will issue.
- Donors of life insurance policies will be required to provide consent to allow access to medical records for purposes of evaluating the life insurance policy. This information will be maintained on a confidential basis.
Frequently Asked Questions
What types of policies are eligible?
Term/permanent (whole life and universal)
Who pays for medical underwriting?
Who pays for actuarial underwriting?
What size policies do you accept?
Between $50k and $20m
What are your selection criteria?
We are working with a life expectancy (LE) calculation of up to 5 years. However, depending upon the circumstances we could go beyond 5 years. Rule of thumb: insured is 70 years old and over, with a medical condition or 80 years old and over, without medical condition.
Who pays the premiums after the policy has been donated?
Who is the beneficiary of the policy after it has been donated?
Who is the owner after the policy has been donated?
Who does all of the due diligence and underwriting?
The foundation has partnered with PENTOR Charity Services who looks after these aspects.
How does the process work?
You call/email us and give us the following information:
- Face value of the policy
- Annual premium (current and renewal)
Type of policy
- If term, is it convertible without medical underwriting?
- Policy expiration
- Medical condition(s) of the insured
- Age of the insured
How long does the policy have to have been in force for?
The policy must be in force for over 2 years.
How long does the process take?
Triage: less than 1 week
Medical underwriting: 1-2 weeks
Actuarial underwriting: 1 week
Donation paperwork: 1 day
Total time: 3-4 weeks
What is the typical value of the tax receipt that the donor will receive?
It varies on the life expectancy calculation, which depends on age and medical situation.
What if one of my relatives wanted to benefit from the policy?
Before a policy donation is approved, we must ensure that no relative is interested in taking over the policy.
Is it legal?
Yes; the entire process is legal, ethical, and approved by the government.
But what’s in it for me?
You had planned to cancel your policy in order to save paying the premiums. The Foundation pays the premiums (you save $$) and you get a tax receipt which puts money back into your pocket.