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Survivorship
Life Insurance
What is it?
Survivorship Life is a second-to-die life insurance
policy. (USLIP)
Second-to-die coverage is for two persons
(usually husband and wife). The death benefit of a second-to-die
policy is not payable until both people covered by the
policy die.
Second-to-die coverage is used primarily
in estate planning. It protects children and other heirs
from the burden of estate taxes, which often become
due and payable nine months after the date of the second
insured's death.
Tax advisers and estate planners routinely
recommend second-to-die coverage as a way to pay estate
taxes and other costs associated with settling a large
estate.
Interest sensitivity and cash value build-up
Premiums paid into your Survivorship
Life policy will earn interest at a competitive rate,
guaranteed never to be less than 3%. Your policy can
develop available cash value, which can be used by you
for other purposes, if needed.
Premium flexibility
Subject to the initial minimum premium
requirements described in the policy, you can pay whatever
premium you wish. Any premium you pay over and above
the minimum can result in an even larger build-up of
the policy's cash value, or enable you to reduce future
premiums.
Disability of premium waiver
This rider to your Survivorship Life
policy can waive the policy's monthly deduction in the
event of disability. It can cover one or both insureds.
(USLIPDW)
Coverage flexibility
The amount of protection in your Survivorship
Life policy can be increased at any time, subject to
the insurability of the two insureds. Additional premium
may or may not be necessary. A reduction in the policy's
amount of coverage can occur, once the policy develops
a positive surrender value.
Proceeds from a life insurance policy
paid because of death of the insured are generally excludable
from the beneficiary's gross income for tax purposes.
Riders
Automatic Increase Rider. Your
estate is likely to grow in value. When it does, your
need for additional coverage will grow as well. By including
the Automatic Increase Rider with your policy, your
coverage can automatically increase every year and eventually
grow to as much as twice the original amount of coverage.
(Form USAIR)
Contemplation of Death Rider. Maybe
your estate plans are not complete, but you're in the
process of finalizing them. This special optional rider
enables you to get the necessary coverage in place now,
including some important additional temporary protection.
(Form USLIPCD)
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