It would be a total catastrophe if a life insurance policy, in a Life Insurance Trust, lapsed before the insured died! All that planning & execution with no benefit.
Despite the best of intentions, things change, and being on top of change is the key to success.
Change in the Life Insurance is tied to the performance:
- performance of the insured/trustee in diligently paying the premium
- performance of the underlying investment
- and finally the performance of the insurance company in paying the benefit
Permanent life insurance contracts are designed to last until death. That can be 30 or 40 years.
In that period things will change.
To be certain that current or even policies under consideration are built to last, put the contract thru a “Stress Test”. Make sure the policy is appropriately funded to guarantee that when the day comes, the death benefit is paid.
We recommend every 5 years a life insurance policy should have a complete review, but at a minimum every 10 years.
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