TRUST SERVICES
Insurance Trust
Keeps and safeguards the payout to ensure the funds are distributed to your beneficiaries exactly as planned, free from creditors.
What is an insurance trust?
- An insurance trust is a trust structure that holds one or more life insurance policies allowing for controlled distribution of proceeds upon death. It can set up by designating the name of a corporate trustee as the beneficiary of the insurance policy (or transfer policy ownership to it).
- At this stage, the trust is essentially “dormant”, holding only the rights of this policy. However, upon death, the insurer pays the death benefit directly to the trustee. The trust then becomes fully activated (as it is now funded) and the trustee can begin investing and distributing the funds as per the trust deed and letter of wishes.
- Due to the trust not having any actively managed complex liquid assets or real estate during its dormant period, there are usually lower annual maintenance fees involved.
- Insurance trust can be used as a savings function to increase the efficiency of capital use to achieve the appreciation of the family’s overall assets.
SIMPLE INSURANCE TRUST PROCESS: 6 STEPS
What are the benefits?
Controlled distributions
You can stagger payouts instead of giving a large lump sum
Avoids the probate process
Saves time, money, and keeps matters private
Creditor protection
The payout is segregated from your personal liabilities
Who should consider an insurance trust?
