FAQs for Non-Profits

What are the benefits of using life settlements as part of a charitable gifting program?

Donor Benefits:

  1. Making a donation to his/her favorite philanthropic organization without depleting cash reserves or losing income-producing assets.
  2. Getting a tax deduction for the fair market value (selling price) of the life insurance instead of only cash surrender value.
  3. Being able to see their donation put to use during their lifetime, rather than after their death if the organization did not utilize a life settlement.
  4. Eliminating the requirement of continued premium payment on the policy.
  5. Removing a taxable asset from their estate if the policy was individually held.

Organization Benefits:

  1. Revive a donation from a donor who may not have otherwise been in a position to contribute.
  2. Collect a lump sum of cash today for capital projects, instead of having to wait for the insured’s death to collect the proceeds.
  3. Not having the financial burden of paying premium payments to keep the policy in force.
  4. Providing a valuable option to the donor that furthers their tax and estate planning objective and invites the opportunity for future/additional gifts.
  5. Accommodate an owner who wishes to see the policy’s hidden value tapped while he/she is still living.
  6. Develop stronger relationships with donors through more creative planned giving programs.
  7. Improve annual budget forecasting ability.