Trust Officers
Although trust owned life insurance (TOLI) is a common planning vehicle for many affluent individuals and families, relatively few TOLI policies ever meet their initial projections. Policy performance can change drastically over time and policies, especially older ones, can pose very significant risk or not achieve their original goals.
Trustees need to recognize that life insurance is an asset that must be periodically reviewed by an independent expert to avoid risk and optimize asset performance. If a life insurance policy is under-performing or is insufficient for current client needs, a life settlement may be the best option.
Questions to ask your clients
The following are common questions to ask your clients prior to determining whether a life settlement may be a viable option:
- When was the last time you had your life insurance policy reviewed?
- Does the need for the policy still exist?
- Have you had any significant life changing events?
- Is your policy in danger of lapsing or being surrendered?
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