The proceeds of a dollar life insurance pay directly outside of the borders of South Africa.
Read MoreCategory: Information
An estate planning advantage
Creating a tax efficient nest egg for the next generation.
Read MoreAn estate planning tool
A dollar life insurance contract is currently one of the most effective and efficient estate planning tools available to South Africans.
Read MoreWhat type of life insurance policies can be USD denominated in a South African context?
Any I suppose but they typically are not when issued by South African insurers. The most prevalent will be investment type policies like endowments issued in hard currency denomination and are typically lump sum investment oriented. These products are very …
Read MoreCan USD denominated life insurance have additional benefits linked like disability or severe illness pay out features?
Yes, it depends from product to product but insurance contracts typically have various optional benefits that can be elected. It will influence the price of insurance and typically critical or sever illness benefits can be quite expensive even if the …
Read MoreAre the premiums paid for USD life insurance tax-deductible?
No it is not and it will be treated like any other personal insurance premium.
Read MoreAre the proceeds from a USD denominated life insurance policy taxable in South Africa?
Yes, and no. Typically it is tax free in the hands of the beneficiary but because it is a deemed asset in the estate in terms of paragraph 3 (3) (a) of the Estate Duty Act of South Africa it will attract …
Read MoreProcess to sell USD denominated life insurance
Typically, this could be very onerous especially in the case of whole of life or permanent insurance. Some term insurance policy with light underwriting requirements might be easier. Whole of life insurance typically needs some form of medical examination to …
Read MoreWhat can USD denominated life insurance be used for?
Peace of mind in case of an early death, disability or sever illness Wealth transfer Diversification Time risk Currency risk Behavioural risk Saving Return of premium Product features providing a form of cash back Estate and tax planning Probate Executors …
Read MoreMust the proceeds of USD denominated life insurance be paid in South Africa?
No, not necessarily. It depends how you structure the policy, most insurance contracts give you the ability to nominate beneficiaries for proceeds, which is a critical estate planning tool. There are however many potential pitfalls to take into consideration, amongst …
Read More