The
Dilemma
Many friends of
Emmanuel have limited resources that make it impossible to give
a large gift to the Seminary. Yet they desire to be as
supportive as possible of the mission and purpose for which
Emmanuel exists. How is it possible to match that enthusiasm for
Emmanuel with a similar financial gift?
The
Solution
The answer is insurance.
We insure our health. We insure our houses. We insure our
automobiles. We even insure our lives. There are many types of
policies in the insurance market that cover our lives and mature
at death. Some of these policies have a cash value that grows
with the age of the policy, while other policies have no cash
value. These “term policies” simply have a death benefit.
Life insurance is
both easy to give and to receive. It is so easy that the donor
does not even need a formal planned giving program to contribute
such a planned gift. In fact, life insurance is one of the many
assets the donor can contribute without much assistance at all.
Through life insurance, a large gift may be given to Emmanuel
through the small cost of annual premiums.
Let’s
Be Specific
•
Years ago you purchased an insurance policy to insure that there
would be sufficient funds for your children’s college
education if you should die. Now that your children have
finished college, the policy is no longer needed. Or there may
be other purposes for which you purchased insurance which are no
longer valid. You might consider changing the beneficiary of
such a policy to Emmanuel School of Religion or some other
charity, especially if the policy is paid up or has any cash
value.
•
You may set up a new insurance policy, either a whole life or
term policy, and name Emmanuel School of Religion as
beneficiary. The premium amount may be sent to Emmanuel each
year and the Seminary will pay the premium payments to the
insurance company. The premium amount you send to Emmanuel is
considered a contribution and is therefore tax deductible as a
charitable contribution each year. Upon your death, Emmanuel
will receive the face amount of the policy, a far greater gift
than the cost of the premiums.
•
If it is impossible for you to purchase insurance on your life,
you might consider purchasing a policy on the life of another.
You may insure your spouse or a sibling, for example. When
Emmanuel is named as the owner and beneficiary, premiums are tax
deductible.
Upon
my death does life insurance become a part of my estate?
Life insurance
gifts are not subject to probate costs nor delays in settlement
unless the policy proceeds are payable to the estate. If you
name Emmanuel as the beneficiary of the policy, the life
insurance gift is immediate. The proceeds do not become a part
of your estate and can be paid at your death, in cash, to the
School.
Are
there any tax benefits in giving life insurance to a charity
such as Emmanuel?
Yes, but it depends
on the policy. If you give a paid-up policy, then you may deduct
the approximate cash surrender value of the policy. If you
purchase a new policy and name Emmanuel or another charity as
beneficiary, then you may deduct the premiums if the charity is
named as owner. If you give a policy on which you are still
paying premiums, you may deduct the cash surrender value as well
as future premiums that you pay to keep the policy current.
Can
I name more than one beneficiary on an insurance policy?
Yes! You may name
co-beneficiaries on a policy. Emmanuel can be one of the
beneficiaries and the second beneficiary may be another charity
or an individual. You also may name Emmanuel as the secondary
beneficiary in the event the first beneficiary has died. Or you
may name Emmanuel as the last beneficiary if primary or
secondary beneficiaries are deceased.
I
own a life insurance policy and would like to change the
beneficiary to Emmanuel. How do I do that?
Simply write a
letter to your insurance company, citing the policy number,
and tell them you would like to make a charitable gift of
your life insurance policy. Tell them you would like the
appropriate documents to make Emmanuel School of Religion the
primary beneficiary upon your death.
What
sort of documentation is needed to name Emmanuel as beneficiary
of an insurance policy?
To insure that your
wishes are carried out, it would be helpful for Emmanuel to have
a copy of the insurance policy, which should contain information
such as the policy number, policy face value, the official
naming of Emmanuel as beneficiary, and the naming of any
co-beneficiaries. It should also note whether any premiums are
due or if the policy is paid up.
