Life Insurance Policy An important but frequently overlooked role of life insurance is the one it can play in charitable gift planning. Life insurance itself can be the direct funding medium for a gift, permitting the donor to make a substantial gift (face value of policy) for a relatively modest annual outlay (i.e., the premium payment). Life Insurance Policy Click to See Diagram Life Insurance to Replace Gift Life insurance can also be used to replace an asset that has been given to FSUF. How it works: After a donor makes a gift to FSUF, the tax savings produced by the charitable deduction are used by his or her children or an irrevocable trust to purchase and pay the premiums on a life insurance policy on the donor's life. Such an arrangement can ensure that the interests of family beneficiaries will not be adversely affected. Life Insurance to Replace Gift Click to See Diagram Back © Pentera, Inc. Planned giving content. All rights reserved. Disclaimer