Why is trust important in insurance?

Trusts in insurance are important, especially for estate planning and the distribution of life insurance proceeds, for several reasons. An important thing is always considering placing a life insurance policy in a trust, such as the one managed by One Pacific Trust, since there are numerous benefits associated with enhancing financial security and management of the payout.

This makes it advantageous for the trustee of a trust to better control how these life insurance proceeds are disbursed. Other than just outright payment of a lump sum to beneficiaries, the trust could disburse over time or when specific conditions, as defined by the policyholder, have been satisfied. In cases involving minor children or beneficiaries with long-term financial dependencies, such provisions are quite valuable. One Pacific Trust specializes in such structures, which are designed to ensure the funds are secure and function entirely in accordance with the policyholder's wishes.

Second, placing life insurance in a trust can help bypass the probate process. This means that the insurance proceeds can be distributed in a timely and private manner, avoiding delays and public scrutiny often associated with the probate process. In addition, the proceeds of life insurance may fall outside of the policyholder's taxable estate if there is an irrevocable trust, thereby reducing estate taxes for beneficiaries.

In summary, placing life insurance in a trust with One Pacific Trust provides for controlled, tax-efficient, and private distribution of assets-important tools in managing wealth and providing financial security to your loved ones.