SMART CHARITABLE GIVING
Found Money
OVERVIEW: Generate donations/gifts for nonprofit organizations, churches, synagogues and temples and/or transfer wealth to your loved ones without any out-of pocket premiums. You must qualify for this medically and financially.
Section 1: Description of Program
WHAT IS IT? A donation/gift is pledged to nonprofit organizations, churches, synagogues and temples The pledge is paid upon your passing. A referral donation is also available. Donation details in Section 2 Note: The beneficiary payment can be to your loved ones rather than a donation to an organization.
HOW TO DO IT? Acquire a life insurance policy for which you pay no premiums. The beneficiary is designated on the policy and paid upon your passing, hence your donation.
WHO PAYS FOR IT? A major bank pays your premiums and another major bank collects the premiums and manages your Irrevocable Life Insurance Trust.
WHAT WILL IT COST YOU? You do not pay the premiums or pledge any collateral.
WHO OFFERS THIS POLICY? Life Insurance Carriers that are ‘A’ rated and higher. The A, A+ and A++ ratings are the top 3 of 15 ratings.
What age is qualified? 70 to 90 years old.
Section 2 Donations Available
IMMEDIATE REFERRAL DONATION: The nonprofit organizations, churches, synagogues and temples receive an immediate donation to their cause when the insured is referred by them and a policy is issued. The immediate donation is funded by the agent.
BENEFICIARY:
The beneficiary can be either a loved one of the insured’s choice, an organization of the insured’s choice, or a mix of a loved one and an organization.
HOW DOES IT WORK? The insured’s pledged donation amount available to your organization is 10% to 12% of the face amount at the policy issue. The face amount decreases annually to between 8% to 10 % of the face amount at your life expectancy and further decreases to 4 % of the face amount at age 100.
WHEN IS THE BENEFICARY’S DONATION EFFECTIVE? The beneficiary donation is effective once the policy is enforced and the loan consummated. The specific non-profit organizations, churches, synagogues and temples is the beneficiary on the policy. The beneficiary is paid upon your passing.
Section: 3 Responsibilities of the Applicant
WHAT IS THE APPLICANT RESPONSIBLE FOR?:
· Taking a medical exam & evaluation which determines acceptability to the insurance carrier.
· Financial Statement which reflects a Net Worth of minimum of 2 million dollars, one million of which is other than home
· An Unsecured Personal Guarantee for 25 % of the loan amount for up to 5 years. The Unsecured Personal Guarantee can be replaced by a cash payment.
· The cost of $100 for setting up an Irrevocable Life Insurance Trust.
WHAT THE INURED IS NOT RESPONSIBLE FOR
· Paying Premiums
· Paying Interest
· Pledging Collateral
Section 4: Default Conditions
DEFAULT CONDITIONS WHEN OR IF THE UNSECURED PERSONAL GUARANTEE WILL BE CALLED
· The Insurance carrier goes bankrupt. This is highly improbable with the high rated companies we are utilizing. Historically, if an insurance carrier goes bankrupt, other carriers purchase the assets of the defunct carriers and continue the business. This is called run-out.
· Cost of insurance increases, This is mitigated by non-lapse guarantees which means Guaranteed Products
· Death of insured and the insurance carrier contests the claim due to fraud. This is mitigated by insuring that all the information given by the applicant is accurate and correct.
· The bank goes bankrupt. This is highly improbable with the ‘A’ rated bank we are utilizing. Historically, if a bank goes bankrupt, other banks purchase the assets of the defunct bank and continue the business
· Note: The bank has loaned over 4 billion dollars of this type of loan and has not called any of them.
DISCUSSION OF DEFAULT CONDITONS
· The bank is not interested in calling the guarantee because they will make more money from the death benefit by continuing to pay the premiums or sell the policy on the life settlement market.
· The insurance carriers are the main thrust in requiring the guarantee as they require the insured to have some form of financial responsibility, i.e. an Unsecured Personal Guarantee. Thus the insured has a recourse loan by virtue of the Unsecured Personal Guarantee. There is no free insurance.
· As you can see, the risks are minimal, the rewards are gratifying
Section 5: Risks
DOWNSIDE TO THE INSURED
· Once the insured has consummated this transaction, they have consumed all their capacity to get insurance, hence the insured cannot get any additional life insurance.
DISCUSSION OF THE DOWNSIDE
· Typically, if the insured has not utilized their capacity to obtain insurance by their 70’s, it is highly unlikely that they want or will need any additional insurance, except for charitable reasons.
· As you can see, the risks are minimal, the rewards are gratifying
Section 6: Example
A person has a 3 million net worth.
They make application for life insurance and are approved for 3 million dollar face amount.
The ‘life expectancy’ is determined for the bank and a financial analysis is conducted to determine the feasibility of such a transaction. If feasible, the policy is put in place.
The applicant’s choice of beneficiary will receive estimated 10 to 12 % of the face amount, approximately $360,000 at the issuance of the policy. This will slowly reduce to 8% to 10 % of the face amount, approximately $300,000 at life expectancy. If the insured lives to 100, the donation will eventually decrease to 4 % of the face amount, approximately $120,000 at age 100.
Note: The insured’s estimated share of the face amount is determined by the cost of insurance and life expectancy of the insured. The feasibility is determined by the ability to do arbitrage between the cost of insurance and the profit the bank will make on the transaction. The numbers do the talking.
Contact: support@worldpeaceflag.org 888-339-FLAG
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