Gifts of Life Insurance

Giving a gift of life insurance either through an existing policy or a new one is a great way to turn small monthly premiums into a significant charitable gift.

Small Premiums, Significant Gift

Life insurance is one of the most effective means to maximize giving, and can be an excellent planned giving tool for a donor who wishes to make a substantial gift to ministry. Depending on the policy chosen, moderate premiums are spread over time with the resulting gift being quite significant at time of death. Both existing or new life insurance policies can be donated. While there are many different types of life insurance, the principle of giving remains the same; a relatively small present gift will ultimately provide a much larger gift in the future.

There are a few ways to use Life Insurance as a charitable gift.

  • Name LFC (or other ministry) as the beneficiary of your policy. Upon your death, the proceeds of the policy go directly to ministry bypassing your estate, and your estate receives a tax receipt for the full amount of the policy.
  • Transfer ownership of an existing policy to LFC, which automatically makes us the sole beneficiary (according to the Insurance Act). You receive a current tax receipt for the fair market value of the policy and receive an annual charitable deduction for any ongoing premiums you continue to pay. Upon your passing, funds received by LFC will be disbursed according to your Gift Allocation Agreement filed with us.
  • Take out a new policy naming LFC (or other ministry) as the beneficiary then choose to retain or transfer ownership of the policy once it is in force. Charitable receipting will depend on the option chosen, as outlined above.

Using life insurance is convenient, simple, and doesn’t require any changes to your will. If you name LFC as the beneficiary or transfer an old or new policy, then use LFC’s Gift Allocation Agreement to designate what ministries are to benefit from your gift when the time comes. Check the link below for more information on LFC’s Gift Allocation Agreement.