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A gift of life insurance makes it possible for you to leverage your contributions to charity. Your gift to charity is assured with a paid-up policy or through a policy with ongoing premiums paid by the donor. New or existing policies can be gifted to MFC. You may choose to continue paying premiums directly to the insurance company or donate the money to MFC to pay premiums.
Within days or weeks of your death, the insurance proceeds are paid directly to MFC outside of your estate.
When you transfer an existing policy to MFC, a charitable tax receipt may be issued to you for the value at the time of the transfer. A receipt can also be issued for ongoing premium payments but only if you have also irrevocably transferred ownership of the policy to MFC.
Instead of purchasing multiple charitable life insurance policies to benefit several charities, you can purchase one policy and name MFC as the owner and beneficiary or just the beneficiary. You may then recommend to MFC (on a separate document) how the proceeds of that policy should be managed or distributed. You may amend your recommendations at any time without cost. Using MFC to distribute the proceeds from your charitable life insurance policy will save you money and provide flexibility.
- Life insurance proceeds flow outside your estate and will reduce probate fees costs.
- You can enjoy significant tax savings either today or in your estate.
- A gift of life insurance is not subject to challenge by an estate beneficiary or secured creditor.
- You may make the distribution anonymously, if you wish.
- You can leverage your charitable giving without significantly diminishing your estate.
- Life insurance gifts reach the charities much more quickly than those given through the estate.
You may deal with the insurance broker of your choice or MFC can recommend brokers who offer a range of insurance products. It makes good sense to call an MFC Consultant before you contact your insurance agent to find out more about gifting with life insurance. Understanding the process and the various alternatives will help you better choose the right options to meet your charitable goals.