Those who are philanthropic consultants or employed by non-profit organizations and foundations as fundraisers will want to be aware of the opportunities associated with increasing revenue through Life Settlements as well as having donors see their contribution immediately benefit the charity.
A Life Settlement Can be a Major Gift that Supports Institutional Advancement
The option of a Life Settlement for certain donated policies can make the difference between budget cuts and continuing on with services. When contributions are down or capital is needed, charities and other nonprofit organizations need not liquidate assets or wait decades to receive the proceeds from death benefits of donated life insurance policies. A more timely influx of cash available from a life settlement may be more useful in maintaining the financial strength and sustainability of the institution.
Explore Monetizing Donated Insurance Policies when the Premiums Become Too High
Some organizations making premium payments for donated policies find the expense overwhelming. Out of necessity the policy may be surrendered or allowed to lapse. Most development staff are not aware of Life Settlements. A periodic review of donated policies should be conducted to determine which policies could be prospects for a Life Settlement.
When treated as an asset, the eligible donated policy (with the insured's consent) can be sold to the highest bidding reputable financial institution for a lump sum of cash that is substantially greater than the cash surrender value and less than the death benefit. The purchaser or funder takes over the responsibility for all following premium payments and becomes the new beneficiary of the policy. Download the Whitepaper, "Life Settlements for Charitable Organizations: Procuring Needed Capital from Donated Life Insurance Policies"
Make a Major Gift Possible (Not from the Usual Suspects)
In a scenario where a potential donor is being solicited for any contribution, an option would be for the donor to consider an unwanted, unnecessary, or unaffordable life insurance policy for a charitable donation; either from proceeds of a life settlement done by the insured, or a policy donation with the non-profit becoming the policy owner and then proceeding with a life settlement. This allows for a major gift from an otherwise discarded asset and has the bonus of the donor not even putting a hand in their pocket and getting a generous tax benefit to boot.
It is important to note that when considering a Life Settlement, the donor should discuss tax implications as well as personal suitability with their trusted professional financial and legal advisors.
Lifetime Horizons, LLC provides the appropriate contacts and resources to help organizations and donors realize the full value of their policies.
You may View Brochure and request copies for your clients.
* T-Horizons, LLC does not provide legal, accounting, tax or financial advice although our experts in life settlements are happy to provide education and address concerns with your professional advisors. Donors are advised to speak with their own tax advisor.