subject: Survivorship Life Insurance – The Perfect Estate Planning Tool [print this page] Survivorship Life Insurance The Perfect Estate Planning Tool
In exploring the various types of life insurance, you undoubtedly want to find an option that will work best for your situation. One less conventional option is to choose survivorship life insurance. Also called second to die life insurance or joint and survivor life insurance, this kind of insurance policy will provide insurance for the lives of two individuals at the same time. In general, a husband and wife will take out this kind life insurance policy. The death benefits will not be paid to the beneficiary until both insured individuals have died. Survivorship life insurance falls under the permanent life insurance umbrella because once you open it, you need not worry about renewing the term.
The reason why a couple may choose to take out a survivorship life insurance policy together is because it is a more affordable option than buying two separate policies when insuring the beneficiaries of both parties involved. Another reason to take out this kind of policy is because it is specifically designed to help pay for estate taxes. Since estate taxes are delayed until after both parents have died, the insurance funds can be redeemed exactly when they are needed by the children inheriting their estate.
The most common individuals who take out survivorship life insurance policies are those who are wealthy and looking for effective estate planning tools. In order to make your life insurance policy work the way you want it to, you will need to work closely with your legal and tax counselors. By doing this, you will increase the chances that you can preserve the sum of your net worth for your beneficiaries. If you utilize the right payment strategies and work closely with your attorney, you can ensure that the money in your survivorship life insurance policy will be both income tax and estate tax free.
The goal of anyone shopping for a life insurance policy is to find one that will serve as the most cost effective choice in terms of investing in the account and the outcome for your children after you pass on. Even if you have little experience with life insurance, you can work closely with those who are experts on the topic. They will be able to help you find the best deal for you as long as you work with scrupulous representatives and brokers who are determined to get you the best deal, not ensure they line their pockets even more.
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