PPLI – Private placement life insurance
Need special protection from threats to assets?
What is PPLI?
Assets can be protected against a range of threats. Such assets can be both liquid and fixed, and include:
- stocks
- structured notes
- funds (mutual, hedge & ETFs)
- companies’ shares
- commercial and residential real estate
- vehicles, boats, airplanes
- art collections
Assets are transfered to the insurer in exchange for an insurance policy with the same value. However, after death, the original assets are transferred to the beneficiaries.
Persons involved
Policy holder
The policy holder is the owner of the contract and controls the policy. He has the right to:
- select the investment strategy;
- appoint the beneficiaries;
- surrender the policy; and
- make changes to the policy.
The policy holder can be a private individual, a company, or have a legal structure like a trust or foundation.
Person insured
The term of the policy is linked to this person’s life. When the insured person dies, the contract normally comes to an end. The insured person must be a private individual. However, it is possible to have two people insured (joint-insured).
Beneficiaries
They receive the assets after the death of the insured person. The beneficiaries can be one or several private individuals, or a company, or a legal structure like a trust or foundation.
Arbiter
This is a third party (private individual or company) who is granted specific rights. Typically, an attorney or a trustee would act as the arbiter in a policy.