Domestic and International Asset Protection
In addition to being a tax free investment vehicle, Private Placement Insurance provides financial privacy and asset protection that are of extreme benefit to the high net worth client. Legislation varies from state to state and many offshore jurisdictions offer legislation that is comparable to or better than U.S. state law. Some states exempt not only the debtor’s interest in the life insurance cash value but also the death benefit proceeds.
Many offshore jurisdictions provide specific exemptions and pro-debtor provisions. The laws of the jurisdictions may also provide for the inclusion of spendthrift provisions in the policy itself. By structuring the policy in an offshore account, the policy owner not only receives the benefit of the policy itself as protection from creditors, but it will be harder for the U.S. creditors to reach the policy assets outside of a U.S. jurisdiction.