Best Life Insurance Companies That Offer Policies That Can Be Inserted Into a Trust (2022)

You should not have a problem finding life insurance companies that offer policies that can be inserted into a trust. Most of the time, setting up a trust is helpful if you have beneficiaries who are minors. You can set up the trust with your life insurance policy to ensure that your children will be cared for after you pass away. Using a life insurance policy to fund a trust is typically a hassle-free and inexpensive way to set up a trust.

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Jeffrey Johnson is a legal writer with a focus on personal injury. He has worked on personal injury and sovereign immunity litigation in addition to experience in family, estate, and criminal law. He earned a J.D. from the University of Baltimore and has worked in legal offices and non-profits in Maryland, Texas, and North Carolina. He has also earned an MFA in screenwriting from Chapman Univer...

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UPDATED: Dec 21, 2021

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Overview

  • Many people choose to fund their trust with an existing term or whole life insurance policy
  • Most insurance companies allow for policies to be funneled into a type of trust
  • If you use your life insurance policy to fund a trust, be sure to set it up correctly when designating your beneficiaries

If you have young children, or if you are working toward estate planning, you may be interested in life insurance companies that offer policies that can be inserted into a trust.

For many people, funding a trust with a life insurance policy is a great way to care for and ultimately provide assets that will be used or managed after the insured person’s death.

There are many life insurance trust samples online to provide an idea of what funding a trust with a life insurance policy might entail. And plenty of life insurance companies allow for policies to be inserted into trusts.

Since you may be interested in countless types of trusts, it’s important to understand what you want before you start your search for life insurance companies that offer policies that can be inserted into a trust.

As you search online for the best life insurance policies that can be inserted into a trust, you can use our free tool above to compare policies and rates from top companies in your area.

What life insurance companies offer policies that can be inserted into a trust?

It is possible to fund a trust with your life insurance policy with virtually any life insurance company that can do business in your state.

Some of the most popular life insurance companies with which you may be able to insert a policy into a trust include:

  • Northwestern Mutual
  • Haven Life
  • State Farm
  • Pacific Life
  • Principal
  • Banner Life
  • Guardian Life
  • Nationwide
  • Primerica
  • MassMutual
  • New York Life
  • Allstate
  • John Hancock
  • Prudential
  • Mutual of Omaha
  • Protective

While there may be some life insurance companies that don’t offer policies that can be inserted into a trust, most companies will allow for this sort of policy use.

While most life insurance policies can be inserted into a trust, it is important for you to know how to set up your trust to ensure it works just as it should.

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How do I set up a trust for life insurance?

All trusts you can purchase are either revocable or irrevocable. Irrevocable life insurance trust samples typically include benefits that typically relate to federal or state level inheritance taxes.

Revocable trusts are much more common. A revocable trust can typically avoid probate and is also adjustable by the trust’s grantor.

If you have children who are minors, using a term life insurance policy to fund a trust is a simple and fairly inexpensive way to make sure your children are cared for after you pass away.

If you are curious to learn what term life insurance is and how it could help you when considering creating a trust, you can do some research online to figure out if this is the type of policy you want.

In this scenario, the parents of the minor children would purchase life insurance and name the other spouse as the beneficiary, but there would be a revocable living trust as the contingent beneficiary.

The most important thing to remember when using a life insurance policy to fund a trust is to make the beneficiary designations very clear.

Life insurance policies will make a payout to the designated trust once the parents or guardians pass away, and there would be a trustee that managed the trust account and assets on behalf of the children until they were over 18 years old.

Should I use my life insurance policy to fund a trust?

Life insurance policies are a great and hassle-free way to fund a trust, but there are other ways to fund trusts in the U.S.

You can use cash that you have earned to fund a trust, or you can do so with stock investments, interest earned from other accounts, real estate property, and even personal property like valuable collectibles.

But trusts are especially important for young and growing families. If you have young children, you may want to seriously consider setting up a trust.

Trusts allow you to have more flexibility and control when it comes to how the money is allocated in the event of your death.

Young children can especially benefit from you setting up a trust as the beneficiary of your life insurance policy and giving your trustee all the information and regulations on how that trust should work while your child is still a minor.

As you consider the type of life insurance policy you’d want to set up for your trust, you can speak to a financial advisor or do some research online to decide what would work best for you.

And as you search online for the best life insurance policies that can be inserted into a trust, be sure to try our free quote tool below to compare rates from multiple companies.

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