What is a Life Insurance Gift
A gift of life insurance is where you name Hesston College as a beneficiary or as the owner and beneficiary of a new or old policy.
Advantages to Life Insurance Gifts
- Allows you to make a larger gift with little cost to you
- A simple and easy way to make a gift, normally just filling out a form
- Leaves other portions of your estate open to be given to loved ones or charity if you so choose
- Receive an income tax deduction or an estate tax deduction depending on how the gift is made
- The gift is not a matter of public record and usually not included in the probate process
If you let Hesston know of your plans, you will become a Legacy Partner
Why a Life Insurance Gift
Life Insurance is often an overlooked way to make a gift to Hesston College. Many people purchased life insurance when their families were young or they had a mortgage. Now your family might be grown and financially stable or you no longer have mortgage payments to make. You might not need your life insurance policy or at least not the full amount anymore. Today, it’s not uncommon for individuals to have more than once life insurance policy. Life insurance can be a great way to make a large gift with little cost to you. Many people have found it to be a convenient, easy and simple way to make a gift.
Types of Life Insurance Gifts
- Listing Hesston College as Beneficiary: The simplest way to make a gift through life insurance is listing Hesston College as the beneficiary of the policy. Normally this can be simply completed by requesting a change of beneficiary form. You can also make Hesston College a contingent beneficiary, which means that we would only receive a gift if your primary beneficiary would predecease you. Since this type of gift can be changed you would receive no immediate tax benefit.
- Listing Hesston College as Owner and Beneficiary: Another option is listing Hesston College as the owner and beneficiary of your policy. Since this gift cannot be changed you would qualify for a charitable tax deduction. If premiums are still owed on the policy you would continue to make the payments but they would be tax deductible.
Many individuals want to support Hesston College but they also want to be able to care for their loved ones as well. There are many ways that you can do both. Some people have found that listing your loved ones as beneficiaries on your life insurance policies can be a great way to provide for them while freeing up other assets to be given through your will. Estates can be heavily taxed for loved ones while life insurance might mean that they avoid probate and some tax penalties. Since Hesston College is a not-for profit organization, we are not taxed on gifts from your estate.
Questions to Ask Yourself
If you are interested in gifting a life insurance policy to Hesston College, you may want to review the policies you own and ask yourself these questions:
- Did you purchase a policy to help support a young family, but now all members of your family are financially stable?
- Do you own a policy on a child who no longer needs the financial support?
- Have you paid off your home’s mortgage and no longer need to maintain a mortgage life insurance policy?
- Do you have a policy to provide you with retirement income, and find that the policy is no longer needed?
- Did you purchase a policy with the intention of benefitting a family member who no longer needs it or has predeceased you?