Charitable Giving Through Life Insurance

Why life insurance?

Life insurance provides you with a great deal of power in terms of providing for the people and causes you love most. Some of the benefits of life insurance are:


  • It allows you to provide a large gift through a relatively small annual cost.
  • Life insurance avoids the delay, public knowledge, and high costs of probate.
  • It is generally easy to obtain. Group policies and smaller individual policies usually involve a minimum of underwriting.
  • You can retain ownership of the policy and name an individual or

organization as beneficiary. If your circumstances change in the future, a revocable beneficiary can easily be changed.


Charitable giving through life insurance provides you with the opportunity to grow small premium payments into a substantial future gift to your favorite charitable cause.

Types of Life Insurance

If you are considering life insurance as a means of making a charitable gift, there are a few things you should know before you act. There are two very different types of policies - whole life and term life.


Whole Life Insurance is a policy with premiums that remains in inact for your entire life, as long as premiums are paid.


The policy builds “cash value” over time, which can be borrowed by the policy owner at a low interest rate. If the policy is surrendered prior to death, the policy owner receives the cash value of the policy. If the policy is in intact at the time of death, the face amount of the policy, less any outstanding loan amount, is paid to the beneficiary.


Term Life Insurance is a policy that stays in intact for a specified period of time, such as ten years, as long as premiums are paid. The policy may be renewable at the end of the term period, but the premiums are usually higher for the new term.


Premiums for a term policy are generally lower than for whole life insurance because term policies do not build cash value.


If the policy lapses or is cancelled, the policy has no value and nothing is paid to the owner or beneficiary.

Types of Beneficiary Designations

There are a number of ways that payment of policy proceeds can be arranged.


Primary Beneficiary - You may specify that the charity will receive the entire proceeds of the policy.


Contingent Beneficiary - You may specify that the charity will  receive the proceeds if the primary beneficiary is no longer living. For example, you could name a family member as primary beneficiary and the charity as contingent beneficiary.


Percentage Distribution - You may specify that the charity will receive a percentage of the proceeds, with the remaining proceeds going to one or more other beneficiaries.


A beneficiary designation can be revocable or irrevocable.  With a revocable designation, the beneficiary can easily be changed at any time. An irrevocable beneficiary cannot be changed unless the beneficiary consents in writing. or irrevocable. With a revocable designation, the beneficiary can easily be changed at any time. An irrevocable beneficiary cannot be changed unless the beneficiary consents in writing.

What will your legacy be?

Most people aren’t able to simply write a check for a large amount to their favorite charity, but through life insurance, it can cost very little to be generous. By making premium payments over time, you can

make a meaningful charitable gift without reducing other assets that are reserved for your family.


Talk to your Golden Life Group agent about how you can give the gift you’ve dreamed of.

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