If you have ever thought that life insurance was something you wouldn’t need after you reached a certain level of financial security, you might be interested in knowing why many wealthy individuals still carry large amounts of insurance. Consider the following:
- A life insurance advisor in California recently placed a $201 million dollar life insurance policy on the life of a tech industry billionaire;
- Well known music executive David Geffen was life insured for $100 million;
- Malcolm Forbes, owner of Forbes Magazine, was insured at the time of his death in 1990 for $70 million.
While life insurance is most often looked upon as a vehicle to protect ones family or business, the question that springs to mind is why would individuals with wealth need life insurance? Read more
The Cascading Life Insurance Strategy
If you are a grandparent wishing to provide an asset for your grandchildren without compromising your own financial security you may want to consider an estate planning application known as cascading life insurance.
How does the Cascading Life Insurance Strategy work?
- The grandparent would purchase an insurance policy on his or her grandchild and funds the policy to create significant cash value;
- The grandparent would own the policy and name their adult child as contingent owner and primary beneficiary;