A Guide for Charities with Life Insurance Donations

Insuring A Better World Fund strives to empower charities with valuable opportunities to enhance their impact. Today, we address a unique and often overlooked avenue for charitable giving—life insurance policies. Inspired by the insightful article from our President David Simon published on ThinkAdvisor titled “10 Top Ways to Use Life Insurance in Charitable Giving”, we explore how charities can effectively manage life insurance donations to maximize their benefits.

Life insurance policies can serve as a powerful tool for charitable giving, allowing organizations to receive substantial contributions that may otherwise go untapped. The ThinkAdvisor article outlines various strategies, from designating the charity as a beneficiary to gifting a policy outright. However, once these policies are accepted, it’s essential for charities to have a clear plan in place to maximize these assets for their mission.

Key Steps for Charities:

      1. Conduct a Policy Review: Begin by thoroughly reviewing the terms and conditions of each life insurance policy received. Understanding the specifics, such as the face value, premiums, and any potential riders, is crucial for effective planning. Insuring A Better World Fund’s leadership are experts in this step. Reach out to us with any questions. 
      2. Assess Financial Implications: Evaluate the financial implications of maintaining the policies. Charities should consider factors such as ongoing premium payments, potential tax implications, and the overall impact on their financial stability. Don’t just file the annual statements. Illustrations projecting policy performance are a must. These projections are readily obtained from the insurance company. Again don’t hesitate to reach out to Insuring A Better World Fund for help. Let us use our 100+ years of combined experience to assist you. 
      3. Engage with Donors or Donor Families: Establish open communication with the donors or their families to express gratitude, understand their intent, and gather any additional information, such as general health changes of the insured that may be pertinent to the management of the policies.
      4. Explore Policy Options: Depending on the charity’s goals and financial circumstances, explore various options for utilizing the life insurance policies. This could include holding onto the policies, surrendering them for cash value, or donating them to Insuring A Better World Fund where we take care of all the administration and premium payments. 
      5. Consult with Financial and Legal Professionals: Seek advice from financial and legal professionals with expertise in charitable giving and insurance matters. These experts can provide valuable insights and help charities make informed decisions aligned with their mission and financial objectives. Insuring A Better World Fund’s leadership years of experience and expertise in the utilization of life insurance for charitable giving. Call us at 312.819.0790 or email ds@iabwf.org with questions on policies you may have. 
      6. Communicate Transparently: Maintain transparency with donors and beneficiaries, about the charity’s decision-making process and the intended use of life insurance proceeds.
      7. Update Policies as Necessary: If the charity decides to maintain the policies, ensure they are up-to-date. This may involve updating beneficiary designations or adjusting coverage to align with the donors premium tolerance.
      8. Integrate Policies into Fundraising Efforts: Consider incorporating the life insurance policies into fundraising campaigns or initiatives, showcasing how these unique assets contribute to the charity’s long-term sustainability and impact.
      9. Educate Staff and Volunteers: Provide training to staff and volunteers on the options of donating life insurance ensuring everyone involved understands the potential benefits associated with these assets. Again Insuring A Better World Fund is here to help. 

Life insurance donations can be a transformative resource for charities, offering a sustainable stream of support for their missions. Life insurance is a $21+ TRILLION asset class. Nearly 90% of life insurance policies lapse without paying a death benefit. Last year alone over 265,000 seniors lapsed approximately $200 BILLION of life insurance. How much of that waste did you transform into gifts for your charity? By following these key steps and leveraging the insights from the ThinkAdvisor article, charities can navigate the complexities of managing life insurance policies effectively and ultimately enhance their capacity to make a lasting impact on the communities they serve. If your charity doesn’t have a life insurance expert…GET ONE. Insuring A Better World Fund may be your life insurance expert. There are valuable life insurance policies lapsing every day. If not now, when?

Creating a Legacy of Love: A Philanthropic Journey with Life Insurance

Introduction: “To sell or not to sell that is the question.” This famous line from Shakespeare’s Hamlet is a timeless contemplation of life’s uncertainties. Life is a tapestry of choices and opportunities, and for Mr. O, a successful small business owner, it was a question of what to do with his life insurance policies. As the years passed and circumstances evolved, he found himself at a crossroads, faced with an array of options that would shape his legacy and impact future generations. Join us on a captivating journey of philanthropy and inspiration as we delve into the heartwarming story of Mr. O’s decision.

Chapter 1: Building a Life of Generosity From a young age, Mr. O’s life was marked by acts of generosity and compassion. As a regular contributor to his church and a leader within his community, he had always sought ways to make a positive difference. Little did he know that his life insurance policies, purchased years ago, would become a key instrument in fulfilling his philanthropic dreams.

Chapter 2: A Transformative Moment – The Pandemic In 2020, a global pandemic swept across the world, changing lives in unforeseen ways. For Mr. O, this period became a turning point in his life. As he decided to sell his business, he faced a crucial decision regarding his life insurance policies, which were originally meant for business planning, potential estate taxes, and family security.

Chapter 3: The Options Unfolded – With the help of trusted advisors and careful consideration, Mr. O explored his options. He could have allowed the policies to lapse, saving the annual premium cost for himself but also leaving behind a valuable asset that could benefit others. Alternatively, he could have continued paying premiums, redirecting the proceeds to his family or a chosen charity, but this option didn’t resonate with him.

Chapter 4: A Glimmer of Hope – Then came the discovery of the life settlement market. Mr. O learned that he could sell his policies and reap the proceeds for himself. This route offered a better alternative than letting the policies lapse, and he decided to take advantage of this opportunity for one of his policies.

Chapter 5: Creating a Lasting Legacy – Mr. O’s story doesn’t end there. In his search for a meaningful way to give back, he stumbled upon Insuring A Better World Fund, a nonprofit that accepts life insurance policies as donations. By donating one of his policies to this worthy cause, he could support the ultimate charity of his choice and make a lasting impact on his community. This organization allows donors to choose the ultimate charity to receive the net death benefits, and they cover all premium and other costs associated with the donated policy. This seemed like a perfect solution for Mr. O’s philanthropic ideals without the burden of premium payments.

Chapter 6: The Fruits of Generosity – The results of Mr. O’s decisions were beyond his expectations. By selling one policy, he received a significant sum of money that he could use to secure his future. And by donating another policy to Insuring A Better World Fund, he unlocked the power of philanthropy, receiving a charitable income tax deduction and benefiting his church.

Conclusion: A Legacy of Love – Mr. O’s journey of philanthropy is a testament to the power of giving back. Through thoughtful decision-making and a heart full of compassion, he secured a bright future for himself and left behind a legacy of love and generosity. The lesson we can learn from his story is that life insurance policies can serve as powerful tools for both financial security and philanthropy. 

“To sell or not to sell? That is the question? No, the question is “What is the best use of your life insurance policy for you?”. If you want to use your life insurance policy to fulfill your philanthropic ideals, then Insuring A Better World Fund may be your answer. Together, we can ensure a better world for us all.

The Perfect Blend: A Wise Exit Strategy for a Life Insurance Policy

Introduction: Life is a journey filled with unexpected twists and turns. For Mr. A, a successful financial planner, life had taken him on a path he never anticipated. He had purchased a life insurance policy two decades ago, intending to safeguard his loved ones in case of an untimely event. Little did he know that his noble intentions would lead him to a moment of profound generosity and gratitude, shaping the future in a way he never imagined.

The Policy Predicament: As time passed, the insurance landscape changed drastically. The prolonged low-interest rate environment led to a sharp decline in crediting rates across all life insurance carriers. Unfortunately, Mr. A received an unwelcome surprise: a pending lapse notice from the life insurance company. To maintain his policy’s coverage, he was now required to pay three times the original premium at age 70. A daunting prospect, especially for someone who had recently retired and sought to conserve income.

The Common Path: When faced with such a situation, many individuals opt to let the policy lapse. It is the most common decision, and understandably so, as the burden of increased premiums can seem overwhelming. According to statistics, a staggering 88% of life insurance policies sold in the United States end up lapsing without ever paying a death benefit.

Insuring A Better World Fund:

Mr. A didn’t settle for the common path; he chose the extraordinary one. He discovered the Insuring A Better World Fund, a 501(c)(3) charity that offered a remarkable alternative. By donating his policy to the fund, Mr. A could stop the $16,000 a year premium payments without forsaking the $1 million life insurance policy death benefit.

The Perfect Blend: Mr. A opted for the perfect blend. By donating his policy to “Insuring A Better World Fund”, he secured several benefits:

    • No Cost: The donation to the charity comes at no cost to Mr. A or the chosen charity.
    • Charitable Tax Deduction: Mr. A received a charitable tax deduction for the policy’s valuation, which amounted to approximately $150,000.
    • Legacy Gift: His alma mater received prorated distributions from the Fund, turning the lapsing life insurance policy into a legacy-sized gift.
    • Continued Annual Giving: With the $16,000 savings on life insurance premiums, Mr. A now makes annual donations of $5,000 to his alma mater, generating additional charitable income tax deductions.


Conclusion: Mr. A’s decision to donate his life insurance policy proved to be the perfect blend of generosity and foresight. Not only did he fulfill his pledge to his alma mater while alive, but he also ensured that a charitable cause dear to him would benefit from his legacy. The lesson learned from Mr. A’s story is that with thoughtful planning, a blend of options can lead to a win-win situation for all parties involved. Consider exploring creative ways to make a positive impact while safeguarding your financial future—a perfect blend of gift and gratitude.

Don’t Let Your Charity’s Disabilities Define Your Abilities

By David Simon, Co-founder and President of Insuring A Better World Fund


Born in Alabama in June of 1880, Helen Keller lost her sight and hearing at 19 months old. She lived a full life of nearly 80 years as an author, lecturer, political activist, and most importantly, a disability rights activist who impacted the lives of many. She attended Harvard (Radcliffe) and was one of Time Magazine’s Hundred Most Important People of the 20th century.

Helen Keller never let her disabilities define her abilities.

Unfortunately, many charitable organizations, too often let their disabilities define their abilities. Many charities lack the staff, expertise or critical knowledge to accept a variety of noncash gifts. They use this excuse and fail to “meet their donors where they are” and serve the charitable mission they were designed to support. This deprives the most needy, when the resources of the charitable organization are underfunded. Additionally, there are many charitable consultants who fail to aid these charities in finding alternative methods to accept noncash gifts that could bolster the economic impact of the charity.

Professor Russell James of Texas Tech University performed a study of over one million nonprofit tax returns (IRS form 990) for the tax years 2010-2015 and part of 2016 with statistical analysis of the 761,876 forms from 205,696 nonprofit organizations reporting positive contributions. Professor James concluded, in part, that nonprofits raising over $1 Million in 2010 that reported only cash gifts for the period between 2010 and 2015 experienced an average total growth in contributions of 11% over these five years, barely keeping up with total inflation of 8%. In contrast, those reporting any noncash gifts for the period between 2010 and 2015 grew their total contributions, on average, 50% over the same 5-year period. Cash is Not King in Fundraising: Results from 1 Million Nonprofit Tax Returns, Professor Russell James III, JD, PhD, CFP Director of Graduate Studies in Charitable Financial Planning, Texas Tech University.   

Yet there are third parties that are able to work with charitable organizations to overcome the disabilities inside of the organization to facilitate the noncash gifts their donors could make to fulfill their philanthropic ideals and promote the charity’s mission. One of the most prestigious of these third-parties is Bryan Clontz’s Charitable Solutions, LLC. Mr. Clontz is a frequent speaker nationally at charitable gift planning events. In 2021, Charitable Solutions, LLC facilitated noncash gifts that were declined by the referring charity totaling $1,177,317,142.00, a remarkable achievement and impact for the philanthropic world. Yet for all the wonderful achievements this offered the charities that work with his organization, that same year there were only 0-4 gifts of life insurance that Charitable Solutions, LLC facilitated.

According to the 2022 ACLI Fact Book, life insurance is a 21+ trillion-dollar asset class. Approximately 88% of life insurance policies lapse without paying a death benefit. It is estimated that over 265,000 seniors lapse over $150 billion of death benefit each year and this trend promises to continue for years to come. This enormous asset class is the MOST UNDERUTILIZED SOURCE FOR PHILANTHROPIC GIVING in large part because of charities’ inability to accept the offered gifts of life insurance.

There are many excuses charities use to deny their donors the ability to fulfill their philanthropic ideals with the gift of life insurance. They include: (1) Charities lack the expertise; (2) Charities’ inability to administer the policies; (3) Charities lack the staff to act as a conduit for premium payments on the life insurance policies being offered; (4) Charities choose not to work with third parties; and (5) Charities choose not to pay premiums for donated life insurance policies.

In fact, the National Conference of Charitable Gift Planners held last year in Reno unfortunately did not have a session on gifts of life insurance. More importantly they have not had a breakout session in the past 10 years on gifts of life insurance, thereby depriving their membership of the opportunity to reach over 2 1/2 million senior policy holders who lapsed their policies totaling over $1.5 trillion of potential death benefit gifts to charity.

Despite protestations to the contrary, most charitable organizations do work with third parties in a variety of ways. Accountants, lawyers, investment advisors, and the like all perform necessary functions for the charity to sustain itself, remain properly licensed, file their annual tax reports and manage their investments. Further, many charities use third party consultants to help with campaigns, marketing and various fundraising efforts.

There are thousands of financial planners/life insurance agents, who have the expertise, knowledge and experience to help charities administer and accept noncash gifts of life insurance. There is a 501(c)(3) charity that will perform all functions for the acceptance of a noncash gift of life insurance, including paying the premiums, managing the policy to maximize its value for the benefit of the referring charity, administering the policy premiums and collecting and distributing the net death benefits to the referring charity.

Life insurance like all insurance works on the law of large numbers. It is prudent for a charity not to pay premiums for an individual life insurance policy or even a small number of policies. Depending on the age of the insureds a charity would have to aggregate hundreds if not thousands of life insurance policies to achieve actuarial credibility. This is an impossible task for an individual charity to accomplish. However, this can be accomplished by aggregating life insurance policies from several charities into a single portfolio of policies, analogous to a life settlement fund.

In short, there is no excuse left for charitable organizations to fail to accept noncash gifts of life insurance and access this $21+ trillion asset class for the benefit of the people they serve and the donors who support their organizations.

A suggested policy for noncash gifts of life insurance policies in its simplest terms would be:

“We make every effort to meet the donor where they are and accept noncash gifts of life insurance. For smaller gifts of policies, death benefit of $100,000 or less, we accept only paid-up policies under the guaranteed assumptions of the policy or those policies with cash value exceeding $1000. If the policy is not paid up we will cash in the policy for its cash value upon receipt of the donation. For gifts of larger policies, those with a death benefit exceeding $100,000, we accept paid up policies, policies with cash value, policies where the donor agrees under an advance agreement to pay the premiums and existing policies with value as determined by us (if the charity has expertise and administrative staff to service the policy) or a third party with the expertise and servicing capabilities. We can also accept existing policies with value through a third party charity where the donor and our charity will NOT pay the premium or service the policy.”

Helen Keller in a speech to the Massachusetts Association in 1927, stated “He who is content with what has been done, is an obstacle in the path of progress.” I urge all charities to overcome their disabilities and meet their donors where they are and serve their mission with noncash gifts of life insurance. Let Helen Keller serve as a shining example of what can be achieved despite obstacles in our path. Together we can ensure a better world for us all.

Philanthropic use of Life Insurance: Winning The Triple Crown

Mage just won the Kentucky Derby on May 6th. This is a huge win for the horse, the trainer and the owners. However, this is just the first leg of the Triple Crown. Saturday is the Preakness followed by the last leg, the Belmont Stakes, on June 10th .  Although Mage is entered in the Preakness, it remains to be seen who will win and whether or not Mage will even enter the Belmont Stakes. Winning the Triple Crown is very rare and has happened only thirteen times in over 100 years of horse racing.

Often times in negotiations and legal settlements the parties try to achieve win-win solutions. This allows both parties to feel good and claim victory. Although this can be achieved more often than not, one side feels like the winner and one side experiences disappointment.

Philanthropic use of life insurance is the triple crown of philanthropic planned giving. Now donors can win by helping their favorite charity win big with a legacy sized gift of life insurance. The Financial Advisor and Planned Giving Advisor win too with the charitable gift of life insurance.

The primary purpose of life insurance is to provide a safety net for those who depend on you financially. The death benefit that is paid to your beneficiaries can help them cover daily expenses, future costs, such as college tuition or mortgages and provide liquidity at death for business needs, taxes or income replacement. What if your children are grown, your business is sold, your estate planning is complete, and you have more life insurance than you need?  This results in unneeded life insurance that can now be transformed into a legacy-size donation to a favorite charity.

“Life insurance often provides a death benefit several times larger than the premium paid, which is why it is a great way to boost your charitable giving.” says Robert Stuchiner, Co-founder of Insuring A Better World Fund, and a life insurance professional with 45 years of experience.

There is over $20 TRILLION of life insurance in force in the United States and roughly 88% of these policies will lapse without paying a death benefit. Over 250,000 seniors lapse their life insurance policy each year. More than $150 billion of senior-owned life insurance is wasted annually when the owners stop paying premiums. Despite its enormous size and opportunity, life insurance is the most under utilized asset class for charitable giving.

According to a study by Dr. Russell James, Professor at Texas Tech University, charities that accept noncash donations achieved far more robust growth than other charities. Specifically, Dr. James studied the data of one million nonprofit tax returns from 2010-2015. Over a five-year period, the total growth in fundraising contributions was 11% for organizations that only received cash gifts compared to 50% growth for those that received noncash gifts in addition to cash gifts, and 66% growth for charities that received securities as part of their noncash gifts. Note this study was conducted during a time period of continued asset growth in bonds, stocks, real estate, and more. Today is a different world with declining markets, inflation and donor’s concerns about outliving their assets. Noncash gifts are more important than ever.

Insuring a Better World Fund, a 501(c)(3) nonprofit, helps donors transform this wasted life insurance to better the world. Donors choose. Insuring A Better World Fund pays. Charities receive. Donors can make legacy-sized gifts to their favorite charity with a simple, no-cost solution.

The Triple Win

The Charity Wins: Receive a Legacy-Sized gift with additional benefits.

Save time, money and resources! Insuring A Better World Fund can do it all for charities. The donation process is easy to explain and simple to execute with donors. Insuring A Better World Fund pays all costs, administers the policies and expertly manages the life insurance gift to maximize its value for charity. There is no need for a charity to augment their staff. Insuring A Better World Fund draws from its extensive network of financial professionals, the charities own donor pool and other referral sources to identify and secure donations.

Maximize value! Insuring A Better World Fund’s management team utilizes their decades of experience to underwrite and evaluate policies to determine which policies are appropriate for donation. Donors who make legacy gifts are much more likely to continue to make annual gifts too. The added opportunity to receive a blended gift from the donor’s life insurance premium savings is a compelling proposition for the donor. Donations of life insurance strengthen relationships with financial professionals to secure more gifts and donors. Charities may elect to have Insuring A Better World Fund review their existing life insurance policy portfolio to rescue lapsing policies and maximize the value of the portfolio.

Something new to engage donors! Does marketing a no-cost ask sound easy? It is. This is a no-cost ask of donors with legacy-sized potential. There is no change to human behavior because these life insurance policies would otherwise lapse. Insuring A Better World Fund equips charities with the right tools to easily get donors started on the process.

The Donor Wins:

Eliminate life insurance premiums! Cash flow improves immediately. Once a policy is donated to Insuring A Better World Fund, donors are not responsible for premium payments or any other cost of the policy. Donors may also be entitled to a sizable charitable tax deduction at the time of the gift for the full value of the policy. *

Giving while living! There is no better way to celebrate outliving the need for life insurance than to benefit a favorite charity. Insurance works on the law of large numbers. A single charity cannot aggregate enough life insurance policies to achieve actuarial credibility. Insuring A Better World Fund aggregates policies from all charities into distinct large portfolios of policies. Funds are distributed from this large portfolio of policies on a pro rata basis, allowing for distributions to charities while the donor is alive. The charity the donor chooses is able to recognize the gift upon donation.

Leaving a Legacy! Everyone leaves a legacy, the values the donor wants remembered and carried on after their passing. This is an opportunity to make a lasting impact by supporting a charity working on a cause that fulfills that legacy. The best part is neither the donor nor the donor’s chosen charity pays a dime.

The Financial Advisor and Planned Giving Professional Wins:

Value to the client! Offering a charitable alternative to lapsing a policy is a new and no-cost conversation to have with clients and transforms an unsatisfied client into a delighted donor. The client may also be entitled to a charitable tax deduction based on their policy’s full fair-market value. *

Income! Policies that are donated earn continued renewal commissions. Financial advisors are able to earn first year term conversion commissions. Working alongside donors and boards of the charities that benefit from the good work of securing these donations is a great source of new business.

Job Satisfaction: Research proves that doing well while doing good increases job satisfaction and one’s sense of self-worth. Financial professionals that work with Insuring A Better World Fund will have a lasting impact on charities and therefore the world. Financial professionals feel good about this philanthropic work.

In addition, the financial professional gains valuable prestige and influence in the industry that helps build their business. Think of the leaders of the life insurance industry. Look at the leadership at Finseca. Think of the leaders of any industry. All are admired and celebrated for their philanthropic acts. Be involved. This is the life insurance charity for life insurance professionals. Let’s do the industry proud!

The planned giving professional meets the donor where they are. With over 250,000 seniors lapsing their policy every year, the opportunity for the planned giving professional to satisfy their donors’ intent increases exponentially. Now it’s easy to have this no cost ask lead to more conversations, visits and donations. It’s easy to build good will with the donor base by allowing them to turn waste into a legacy sized gift recognized by the charity.

Here is a link to a list of some of the many charities who have benefitted from a gift of life insurance to Insuring A Better World Fund: https://www.iabwf.org/our-mission-in-action/

We’re at the post. Riders up. We can all win the triple crown together. It is only with your participation that we will all be successful in ensuring a better world for us all.

The Top Ten Ways To Give Life Insurance

David Simon, President and cofounder of Insuring A Better World Fund, recently wrote an article on the Top Ten Ways To Give Life Insurance. This article addresses the ten best ways for non-profits to receive gifts of life insurance. Charities must not miss out on this enormous opportunity to solicit this non-cash alternative for legacy sized gifts. 

ThinkAdvisor has published an edited version of this article on their website. Read it now to learn how charities can access this annual $100 Billion + asset class by transforming unneeded life insurance into legacy gifts at no cost to the charity or its donors.