Life Insurance and Charitable Giving
Giving life insurance to a charity may allow you to make a larger gift than you otherwise could afford. Further, the government encourages charitable giving by providing tax advantages for certain charitable donations (the charity must be a qualified charity). This means that both you and the charity could benefit from your donation (though some charities may not accept a gift of life insurance for various reasons).
Typically, a donor makes a charity the owner and beneficiary of some type of permanent life insurance policy. But, there are many ways of structuring a charitable gift involving life insurance, and one alternative may better suit your needs and those of the charity than others.
Caution: This discussion contains only a brief description of some of the many charitable giving strategies involving life insurance. You should consult your tax advisor before making such a gift to make sure it is structured properly.
Caution: Life insurance products contain fees, such as mortality and expense charges, and may contain restrictions, such as surrender periods. Please keep in mind that the primary reason to purchase a life insurance product is the death benefit.