For those who qualify, life insurance can be used to create an estate literally with the stroke of a pen and a check. After all, an estate is valued by what we own at the instant of death, which means that the moment we purchase life insurance we increase our estate by the policy's face amount. Indeed, the largest asset in a client's estate might well be his or her life insurance.
In its estate creation role, life insurance can be used to:
- Provide for the financial security needs of surviving dependents;
- Equalize inheritances among heirs, such as children;
- Dispose of a business interest according to the owner's wishes; and
- Make charitable gifts.
