Low-cost Variable
Life Insurance
Advantage is structured to provide custom-tailored
life insurance or annuities as part of an overall
financial planning program. Advantage provides
a vehicle by which wealthy and sophisticated
investors can access reasonably priced life insurance.
Advantage
is not subject to the substantial overhead associated
with U.S. domestic life insurance companies.
Such costs would include: a large distribution
system,
commissions, and the costs associated with multiple
layers of Government regulation. In addition
to an agreed initial fee charged to the client,
the
Segregated Portfolio of the Policy is charged
quarterly in arrears with:
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An Insurance Charge
to cover the mortality exposure; |
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An Investment
Management and Custody Charge to cover the
actual investment charges incurred by the
account; |
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An Administrative
Charge equal to 0.375% of the value of the
Segregated Portfolio to cover the cost of
administering the Policy and provide Advantage
with a profit. |
Income Tax-Free Death Benefit
If a policy qualifies as life insurance under
the requirements of the Code, the death benefit
due under the policy is free from Income Tax
when paid to the designated beneficiaries.
Estate Taxation
Generally, a life insurance policy Death
Benefit will be included in the gross
estate of the
insured for United States Federal Estate
Tax purposes
if the insured has sufficient “incidents
of ownership” over the policy (defined
in Code Section 2042) within three years
of the insured’s
death. Thus, by structuring a policy by
using trusts, partnerships or other ownership
and
funding techniques commonly used by United
States Tax
Planning Attorneys, it is possible to
minimize United States Estate Taxes on
the Death
Benefit of an Advantage policy. Any prospective
U.S.
Policyholder should consult competent
tax counsel.
Investment Flexibility
Advantage provides a number of Insurance
Dedicated Funds in which the assets of
the Segregated
Portfolio may be invested. Provided
the investments meet
with the diversification requirements
of the Code, there is no limitation on
the number of
funds
that can be purchased by the Segregated
Portfolio established under a life policy.
In addition,
Advantage imposes only limited restrictions
on investments made within their funds.
Asset Protection
As part of the Advantage structure, spendthrift
provisions can be written into the
life policy to limit the rights of the
Owner.
These provisions
when combined with an irrevocable
trust can provide substantial asset protection
as an ancillary
benefit
of owning a life insurance or an annuity
policy.
Privacy
Other than in exceptional circumstances,
Advantage cannot be compelled to
disclose details of individual
Policies without the prior consent
of the Owner of the Policy.
Tax Benefits
The Advantage policy provides the
tax benefit associated with other
life insurance,
namely:
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The cash amount
within your policy will accumulate free of
current income tax while the policy is in
force. |
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Provided the policy
is a non-MEC, Policy loans should not be taxable
as long as the policy is in force. |
The death benefit will be paid free of
income tax to the beneficiaries
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