Life Insurance For Foreign Spouse

Life Insurance For Foreign Spouse

By | Foreign Nationals | No Comments

There are two main cases that we will address in this article:

  1. I Am A Foreign National And My Spouse Is A U.S. Citizen
  2. I Am A U.S. Citizen And My Wife Is Not

We will review the implications of both of these cases for life insurance.

A few things that we need to state, it is much harder to get life insurance on a foreign spouse than it is on a U.S. citizen. It doesn’t mean you can’t get insurance, but there are certain requirements, documents, and rules you will need to follow. There are A Rated companies that give life insurance to foreign nationals from many different countries.

Should I Get Life Insurance?

In reality it is very important to consider getting life insurance when you have a non U.S. Citizen spouse. The main reason for this is estate taxes. At death you can pass an unlimited amount of money to a U.S. citizen spouse. However, the same is not true if he or she is a non U.S. Citizen.

Please speak to a CPA to find out if you or your spouse are considered a foreign national for estate taxes. However, if this is the case then anything above $5.45 million (in 2016) you could pay up to 40% of your assets in taxes at death.

So many people chose to protect themselves with life insurance, because it’s affordable a simple. Life insurance is not the only solution.

You Can Get A QDOT

Another common way of protecting your assets is with a Qualified Domestic Trust or QDOT. Please speak to an attorney to see if a QDOT is right for you. Here is a good article to understand estate planning with foreign spouses

I Am A Foreign Citizen And My Spouse Is A U.S. Citizen

The good news for you is that at death your U.S. citizen spouse will not have to pay estate taxes. You can utilize an unlimited spousal exception. However it is still a good idea to protect your debts and income with life insurance.

Life Insurance companies do not care so much where you are from, but they do care where you reside. If you live in the U.S. and have been here for a few years, then getting life insurance will be much easier.

However, if you mainly reside outside of the United States, then your country of citizenship will determine what type of insurance you can get, and how cheap it will be. Most 1st world countries will be considered low risk, and 3rd world countries will have a higher risk. This risk determines the price of you policy.

What Do I Need To Get Life Insurance?

You need strong financial ties to the United States. One of the best things you could have is a U.S. property. With a property the process of getting life insurance will be easier and A+ rated companies will want your business.

If you do not have a property then you will need to have substantial assets in the United States. 

I am a U.S. Citizen and My Wife Is Not

Speak to an accountant or tax attorney about your particular case.

In the case where your spouse is not a U.S. citizen then he or she will be subject to estate taxes. The amount they can exclude from taxes will depend if they live in the U.S. or not.  This means that anything above $5.45 million could be taxed up to 40%.

Souse Lives In The U.S.

So let’s say your net-worth is $10 million. At death your wife will not pay taxes on the first $5.45 million. However $4.55 million will be taxable up to 40%. That mean your spouse will inherit approximately $8.18 million, and $1.82 million goes to the IRS.

$10 million -> Spouse gets $8.18 million

Spouse Lives Outside Of The U.S.

In this case the estate taxes are even worse. Your spouse will not have a $5.45 million exemption. That means she would get approximately:

$10 million -> Spouse gets a little over $6 million 

Life Insurance Non Citizen Spouse

As we already mentioned there are many variables to consider, but the most important are:

  • Country of Residency
  • Country of Citizenship
  • Assets In The U.S.

All of the previous affect how easily you can get life insurance, what rates, and what companies will approve you. If you want a quote fill out our contact for at the bottom.

Life Insurance Beneficiary Foreign Spouse

You may already have Life Insurance, and the beneficiary of your life insurance is a foreign spouse. Then consider all the things we already mentioned. You may be the perfect candidate for a QDOT, so speak to an attorney to find out if it makes sense for you. 

Final Word

As you can see your money can disappear in estate taxes if you do not plan correctly. Please speak to an attorney and or CPA, and also protect yourself with life insurance! It’s a very affordable solution that may help you pay for estate taxes.

 

Citizens Life Insurance Review

Citizens Life Insurance Review

By | Foreign Nationals | No Comments

Citizens Life Insurance Review

First of all, in this article you will find our Citizens Life insurance review, and why you should get quotes with other companies as well. We have no affiliation with Citizens Life, this a third party review.

Purchasing life insurance is easier said than done, due in large part to the many companies that sell various types of policies. While a variety of choices can cloud the water, it can also point you in the right direction if you take your time.

Citizens is an insurance holding company that has been providing US customers with coverage since 1969. Furthermore, it has been offering international policies since 1975.

If you aren’t familiar with the Citizens name, it may be because the company has several insurance subsidiaries:

  • CICA Life Insurance Company of America (“CICA LIFE”),
  • Citizens National Life Insurance Company (“CNLIC”)
  • Security Plan Life Insurance Company (“SPLIC”)
  • Security Plan Fire Insurance Company (“SPFIC”)

Citizens is anything but a small insurance company, with it holding approximately $1.4 billion in assets at the close of 2015. Along with this, it has roughly $4.5 billion of insurance policies in force.

Benefits of Citizens

There are many benefits of turning to Citizens for life insurance coverage, including but not limited to the following:

  • A well known brand both among US and international buyers.
  • A history of acquisitions, proving that the company is interested in expansion. Top acquisitions have included Magnolia Guaranty Life Insurance Company, Integrity Capital Corporation, Ozark National Life Insurance Company, Security Plan Life Insurance Company, and Combined Underwriters Life Insurance Company
  • A focus on providing policies to all types of consumers.
  • Specializes in foreign citizens

Point number three is among the most important. The company makes it clear that it has whole life insurance products for “high net worth, high income foreign residents.”

Furthermore, it also offers “whole life insurance policies to middle income households concentrated in the Midwest and southern United States through independent marketing consultants.”

Note: Citizens also sells final expense insurance to consumers in Arkansas, Louisiana, and Mississippi.

Downfalls of Citizens

While there are some benefits of turning to Citizens for whole life insurance, many have found that there are too many downfalls to overlook.

To start, the company’s independent marketing consultants are only located in certain parts of the country. This makes it difficult for a large number of consumers to do business with the company.

Along with this, it does not have the best reviews or ratings, when compared to highly reputable life insurance companies. For example, Seeking Alpha calls Citizens a “low-quality life insurance company trading at sky-high valuations.”

While this has a lot to do with the company’s stock price, it goes a long way in showing what outsiders think about the quality of Citizens as a whole.

Here are some other points that have been raised in regards to the company’s business model:

  • It sells life insurance policies overseas without a physical presence, which involves some gray area in regards to the legality.
  • Foreign insurance regulators could eventually crack down on the company, which could lead to its demise.

If you are interested in reading their annual report here is a link for you: https://www.citizensinc.com/pdfhtml/Citizens_2015_Annual_Report.pdf

However, for foreigners looking for life insurance in the United States, we would recommend to get multiple quotes. Many high rated insurance companies will insure non-U.S. citizens. However, if you do not have financial ties to the U.S. then it may a difficult. Just to name a few of these insurance companies:

  • MetLife
  • Prudential
  • Transamerica
  • AIG

Any of the previous companies could provide a more secure bet for life insurance. Despite the fact that Citizens has more than $4 billion of insurance policies in force, the company is seen as a big risk.

Conclusion

Finally, there is no denying the fact that Citizens has made a name for itself in the U.S. However their expertise is in international life insurance markets.

Unfortunately, negative ratings and reviews aren’t doing the company any favors. From a consumer perspective, there are better life insurance companies out there.

If you do not have financial links to the U.S. and you still want to get life insurance, then you might want to look into Citizens.

Life Insurance Non Citizen – Citizens Life Reviews:

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5 Mistakes: Life Insurance For Foreign Nationals

By | Foreign Nationals | No Comments

In this article we will go over 5 common mistakes you want to avoid when getting life insurance for foreign nationals. A mistake can be very costly because not only it can cost you money, but also it can cost you getting denied for life insurance. 

Are You A Foreign National?

Life Insurance for Foreign Nationals

First of all, you may get life insurance for foreign nationals in the U.S. if there is a need for it. People that have a financial need in the United States can get life insurance. So here we provide you with a few examples of what determines financial need in the U.S.:

  • Properties in the U.S.
  • Investments in the U.S.
  • Dependents in the U.S.

Determining if you need the life insurance is a different topic altogether. So let’s assume you need the life insurance and you are able to get it.

Our goal in this article is to help you avoid mistakes that can cost you in the long run:

1- Taking Any Company

There isn’t one company that will be the best for every situation. Obviously, you want to make sure you get the best price possible with the best company, but every company is different.

First of all, your price and rating will be based on your country of citizenship and residence. Also life insurance companies treat every country differently, so you need to request quotes from multiple companies to get the best price. When you get quotes, you will see that companies will offer you very different prices. In addition the insurance companies may restrict what type of life insurance they will offer to you.  

2- Not Having All Paperwork Ready

In general life insurance companies are scared of risk. They also want to make sure that they don’t give life insurance to someone that has a high risk without them knowing it. That is the reason why they will request a lot of paperwork, so you have to be prepared from the beginning. Here is a list of documents you will need to provide:

  • Property deeds in the U.S.
  • Bank statements in the U.S.
  • Investment statements
  • Translated medical records from your country
  • W8 form
  • Copy of passport and visa

There may be more documents that you will need to submit, so be ready to communicate with your agent. Not having all the necessary documents will slow down the process. 

3- Not Having Enough Time

You need to make sure you will have enough time while you are in the United States to finish all of the process. So be careful because getting life insurance takes about 4 weeks to get approved. Following our previous step should help you, and it will speed up the process.

We have helped foreign nationals in less than 3 weeks, but that is an exception not the rule. Also, we have seen clients that do not make a quick enough decision and are not able to get life insurance before they leave.

4- Term Is Not Possible

In general getting permanent insurance (Whole Life and Universal) is much easier for a foreign national, and getting Term insurance is harder. However, it is still possible to get Term insurance, if you apply with the right company.

In addition, if you can’t get Term insurance because of your country of citizenship/residence, then you can always use a Universal Life. This is a “trick” we have used in the past. The way a universal life policy works is it gives you a guaranteed period where your life insurance will not go up in price. Most of the time this guaranteed period is until age 95 or 100, however you can drop this guaranteed period to any age. So if you want a 20 year Term, then we can use a universal that has a 20 year guaranteed period, and it will work just like the Term insurance.

5- Using Any Agent

For U.S. citizen’s getting life insurance is very easy, and there are many great agencies that can help. However, getting life insurance for foreign nationals is much more complex, so you need to work with an expert. There are so many variables that will determine the best price and coverage (country of citizenship, country of residence, visa status, connections to the U.S., etc.). Therefore having experts will mean getting the best price for you or not getting life insurance at all.

Also, in order for you to get the best life insurance, you will need to work with a broker that has access to multiple carriers. 

Final Word

All of our listed mistakes happen because of lack of time, documentation, or knowledge from your life insurance agent. Prepare properly by avoiding common mistakes and you will increase your chances of getting life insurance. Also, to increase your chances make sure you work with experts if you want to get the best life insurance. 

Avoid Mistakes Work With Experts

Life Insurance for Foreigners

By | Foreign Nationals | 2 Comments

If you can't get Term insurance, just use a Universal Life that is guaranteed for the same Term you would like.

Tip for Life Insurance for Foreigners
 

Many people look for life insurance for foreigners. First of all, getting life insurance for non US residents is a real possibility, and in this article we will explore everything you need to know about getting life insurance in the U.S.. 

Who Can Get Life Insurance?

Foreigners can get life insurance in the U.S. if they meet certain requirements. Who is considered a foreigner? A foreigner is someone that doesn’t reside in the U.S. and is a citizen from a different country.

Furthermore, for life insurance purposes there are two types of foreigners, ones with financial ties to the U.S. and ones without. A foreigner is considered to have financial ties if they have:

  • Real Estate in the U.S.
  • Assets in the U.S.
  • A Company in the U.S.

With financial ties your options to get life insurance are much better.  More companies will want to insure you, and give you a better rating. If you do not have financial ties your options will be very limited, and very often you will not be able to get life insurance. 

What Type of Life Insurance?

The basic types of life insurance are: Term, Whole Life and Universal. Your country of citizenship and residence will determine the type of insurance that you will be able to purchase in the U.S.. In general, it is easier to get permanent life insurance than term insurance.

Let’s say you know you cannot get Term insurance. Then a fantastic trick is using a Universal Life Insurance and making the guaranteed period the same as the Term you are looking for. Hence, you will essentially have a Term insurance on a Universal Life. 

Where Can I Get Life Insurance?

Your country of residence will determine the type, rating and price of the life insurance. As you can find in our home page we listed the Country Classification. This is a compilation of multiple life insurance companies and how they rate countries:

  • A rating– All your options will be open in an A country, and you will have all the best ratings available and all types of life insurance.
  • B rating– In a B country, most of the companies will not give you the highest health rating. However you still will be able to get Term, and permanent life.
  • C rating– If you reside in a C country, you will have more restrictions on health ratings. As a result you can only get permanent coverage (Universal and Whole Life).

“A” Countries:

Andorra, Australia, Austria, Barbados, Belgium, Bermuda, British Virgin Islands, Canada, Cayman Islands, Cyprus, Czech Republic, Denmark, Finland, France, Germany, Greece, Hong Kong, Hungary, Iceland, Ireland, Israel (excluding West Bank), Gaza & Golan Heights, Italy, Japan, Korean, Liechtenstein, Luxembourg, Macau, Malta, Monaco, Netherlands, New Zealand, Norway, Qatar, San Marino, Singapore, Slovak Republic (Slovakia), Slovenia, Spain, Sweden, Switzerland, Taiwan, United Arab Emirates, United Kingdom.

“B” Countries:

Albania, Anguilla, Antigua & Barbuda, Argentina, Bahamas, Bosnia & Herzegovina, Brazil, Brunei Darussalam, Bulgaria, Canary Islands, Chile, China (Urban), Colombia, Costa Rica, Croatia, Dominica, Estonia, French Polynesia, Guadeloupe, Kuwait, Latvia, Lithuania, Macedonia, Malaysia, Martinique, Mauritius, Mexico, Montenegro, Oman, Panama, Romania, Seychelles, Turks and Caicos, Uruguay.

“C” Countries:

Armenia, Belarus, Belize, China (Rural), Cook Islands, Dominican Republic, Ecuador, El Salvador, Grenada, Jamaica, Kazakhstan, Maldives, Micronesia, New Caledonia, Northern Mariana Islands, Palau, Paraguay, Russia, Samoa, Saudi Arabia, Serbia, South Africa, Sri Lanka, St. Kitts and Nevis, St. Lucia, St. Vincent & The Grenadines, Tonga, Trinidad & Tobago, Turkey, Venezuela, Vietnam.

If your country is not on this list, it will be very hard for you to get life insurance in the United States. Yet there are still options to get life insurance, but it will not be through a U.S. based carrier. 

We Are Experts With Foreigners!

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When Can I Get Life Insurance?

In order for you to apply for life insurance in the U.S. you will need to do all of the process in the United States:

  • Take a medical in the U.S.
  • Sign all paperwork in the U.S.
  • Sign all delivery requirements in the U.S.

If you are planning a trip to the United States, make sure you schedule everything ahead of time, because the process will take between 4 to 8 weeks.

What Do I Need To Apply For Life Insurance?

The process of applying for life insurance for foreigners is identical to U.S. citizens. As we mentioned, all of the process will need to be done while you are in the U.S., and you will need to provide more paperwork. Here are the steps to help you:

  1. Define how much insurance you need
  2. Get an expert quote
  3. Decide the best company for you
  4. Sign applications
  5. Take medical exam: your agent will schedule a blood and urine test.
  6. Submit all necessary documentation
    • W8
    • Medical records translated
    • Proof of Assets (Bank Statement, Property Deed)
  7. Wait 4-8 weeks
  8. Sign the delivery requirements

After this you will be protected and you will have life insurance. The life insurance will pay your beneficiaries even if you go back to your country. 

Best Companies to Get Life Insurance For Foreigners

Over the years we have helped many foreigners get life insurance in the U.S., and there are a few carriers that look more favorably on foreign nationals. Here is our list of the top three companies:

  1. Prudential
  2. MetLife
  3. American General 

The Bottom Line

As you can see it is possible to get life insurance for foreigners in the U.S.. There are many variables to consider when you get life insurance for foreigners; as a result you need to make sure you are working with an expert.

Feel free to comment or contact us or leave us a comment. 

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7 Tips to Get Life Insurance for Non US Residents

By | Foreign Nationals | No Comments

Many Non US residents are looking to get a life insurance policy in the U.S. for many different reasons. Some of the advantages of life insurance for Non US residents are:

  • Leverage the U.S. dollar
  • Better credit rating of U.S. based companies
  • Better life insurance options

The great news is that it is possible to get a life insurance policy for you. 

7 Tips to Get Life Insurance for Non US Residents

In this article we will show you some tips on how to get life insurance for non U.S. residents. These are tips that we have learned through out the years of helping non-U.S. residents purchase life insurance.

1- Not All Companies Are Equal

All companies view your country of citizenship and residence to determine your ratings in the U.S. And life insurance companies have four country classifications: A, B, C, and D. This country classification is what determines the price and what type of life insurance you will be allowed to get in the US. Because every company is different you want to make sure you apply with the right life insurance company that will give you the most favorable rating. 

2- Have All Your Documents

Applying for life insurance can be a hassle, so have all your documents ready with copies of everything. I cannot stress how important this is. The more you provide your agent, the more chances you have of getting a good life insurance policy.

Here is a handy list of documents that you should provide:

Visa, Passport, Medical Records, Property Deeds in the U.S., Bank Statements, Investment Statements. 

2- Time Frame Is Critical

If you are coming to the U.S. to get life insurance, make sure you have enough time to finish the whole process in the U.S. Life insurance companies will require for you to be in the U.S. through out the whole process of application, underwriting and delivery. Prepare ahead of schedule so you have everything ready once you get to the United States.

Let’s say you only have a few weeks to finish the process, then what we have done in the past is apply with two insurance company in hopes that one finishes the underwriting before the client leaves. 

3- Disclose If You Have Multiple Passports

Life insurance companies view all countries differently, so having two passports can be a huge advantage for some people. Make sure you disclose this fact to your agent. In addition, most life insurance agents will not think to ask you for multiple passports, and it can mean getting life insurance or not. 

4- Be Patient after Applying

Life Insurance companies may ask for more information than you originally thought, so just be ready to provide more documents and be patient. At the same time, your agent should be aware of what is your time frame to stay in the United States, and that they communicate this time frame to the life insurance company. In general, the whole process takes between 4-6 weeks. 

5- Transfer Assets to the U.S.

If you are planning ahead and have enough time, then having more assets in the U.S. will benefit you. If it is possible, before you apply for life insurance, transfer money to a U.S. based bank account or an investment account. 

6- Establish a U.S. Based Trust

This tip may or may not apply to everyone. However, creating a U.S. based trust can be a great way of gaining access to life insurance that before you might not have been able to get. You may not be considered a “U.S. person”, but a trust is. Also, a trust will have a tax id that may help if you do not have a social security number. 

7- No Social Security? Complete a W8 form

No problem, most likely you will need to provide a W8 form to the life insurance company. A W8 form is used by a non resident or foreign national to declare that they work outside of the United States.

https://www.irs.gov/pub/irs-pdf/fw8ben.pdf 

Final Word

Preparing properly before you take a life insurance for a non U.S. resident is crucial. Follow our tips and you will improve your changes of getting the best life insurance for you and your family. 

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For Agents

This section is designed for life insurance agents that are looking to help some of their clients get life insurance for non US residents. Actually we get calls from agents every day asking for information on how to do it. The reality is that there a many variables to consider, but we will list 3 companies that are fantastic with non-U.S. residents.

1- Prudential

The best life insurance company for non residents. They have great guidelines for many different countries, and their underwriting is not too strict. One of the downsides is that you will not be able to get a whole life insurance with them.

2- MetLife

MetLife is a name that everyone recognizes around the world. Also, they are a fantastic company for non-U.S. residents and foreign nationals. Their products include Term, Universal and Whole Life insurance.

3- Transamerica

Transamerica used to be the leader in the foreign national market. However, they have tightened up their guidelines for B and C countries.

Contact us if you need help in a case. 

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Life Insurance for South African Citizens

By | Countries, Foreign Nationals | No Comments

If all you are looking for a life insurance for a South African citizen, then complete our contact form, and an agent will match you with the best company.

There are many variables with regards to life insurance for non U.S. citizens, like visa status, residency, age, health, and the purpose of the life insurance.

Define Why You Need The Life Insurance

The first step to get life insurance will be to define why you need it. A few viable reasons are for protecting the following:

While having a reason to have life insurance in the U.S. helps, it doesn’t guaranteed that you will be able to get it. Also your immigration status will define if you can get the coverage.

Life Insurance for South African Citizens living in the U.S. with a Visa

If you are looking coverage and you have lived in the U.S. longer than 2 years, the process will be very simple. There a few top rated life insurance companies that will not have restrictions for south africans living in the U.S.

If you have lived less than 2 years, your visa status and type will play a role on what companies will offer you coverage. Also, there will be restrictions on what time of coverage you can get.

Life Insurance for South African Citizens with a Green Card

Getting life insurance if you have a green card, it will be a very simple process. You will be treaded as a citizen of the U.S. for almost all life insurance companies. You will be able to get Term, Universal and Whole Life Insurances with no restrictions.

Life Insurance for South African Citizens living/residing outside of the U.S.

In this case it will be harder to get life insurance, and your options will be limited. However we have found 1 insurance company that will insure South African citizens living outside of the U.S. The underwriting process for the insurance will be tougher. You will need to have decent health, or the company will decline your application.

Process of Applying

The process of applying for the life insurance will be the same no matter where you reside. All applications will have to be signed in the U.S., and the medical exam required for the life insurance will have to be performed in the United States. You will need to provide with copies of your passport, visa, medical records in English, and a bank account in the U.S. where you will make the premium payments.

Feel free to contact us, or leave a comment if you have any questions.

whole life insurance for non us citizens

Whole Life Insurance for Non US Citizens

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Most non U.S citizens do not know that they can purchase whole life insurance. In the next article you will find everything about whole life insurance for non U.S. citizens. Actually, most life insurance agents do not know what companies offer whole life insurance for non US Citizens. That is why you need to make sure you work with an expert. 

Whole Life Insurance for Non US Citizens

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First of all, let’s go over why whole life insurance may fit your situation. The main differences between whole life insurance and other types of insurance are the guarantees:

  1. Death benefit is guaranteed
  2. Cash Value has a base guaranteed rate
  3. Level premium guarantee (payment). Your payments will never go up in price.
  4. Easy access to cash value even when you are older.
  5. The cost of insurance does not go up. So your cash and death benefit always go up.

In the long run all these features will make whole life insurance the best option for life insurance. It is a very safe and predictable type of life insurance that will be in-force the day you die. In the end, there are many other reasons and strategies to utilize whole life insurance.

Companies With Whole Life For Non US Citizens

There are companies out there that will allow whole life insurance for non US citizens, and the quality of the insurance policies can be fantastic. Some companies will have more death benefit for cheaper price, some may have better cash accumulations. When purchasing whole life insurance as a non U.S. citizen or non U.S. resident, you will have to know what is more important to you. Here is a list to help you. Rate the following according to how important they are to you:

  • Death Benefit
  • Company Strength
  • Cash Value growth
  • Company track history
  • Current interest rates or dividends
  • If you want to access the cash, you will want to know how the policy performs on distributions
  • How quickly the cash value grows

Depending on how your rank these factors, some companies will rank higher than others. All these factors will vary by company, but there are only a hand full of great insurance companies for non U.S citizens. The good news for you is that these companies are among the best even for U.S. citizens.

Here are two great companies that may offer whole life insurance to non U.S. citizens:

Both highly rated, and they have fantastic whole life insurance products. You probably have heard from one of these in the past.

What restrictions exist on life insurance for non U.S. citizens?

We do have to let you know that some restrictions will apply for non citizens. Here is a list of things that will affect your rating:

Country of Citizenship

Depending on what country you are a citizen from, it may be more difficult to get life insurance. The most political unstable countries are the hardest to insure. 

Health ratings

If you have significant health risks, it may be more difficult than if you where a US citizen to get life insurance.  

Immigration status

The longer you stay the easier in the US the easier it is to get life insurance if you are not a citizen. Although as a foreign national there are a few different rules that will apply, and it can be done without a problem.

The good news is that because there are so many variables the best way to find out if you get life insurance is to apply. Make sure you apply with an insurance company that has approved someone with a situation that is similar to yours, and that’s where we come in. Contact us to request a quote and one of our experts will help you.  

Whole life insurance for foreign nationals

Also, if you do not live in the U.S. (and you are considered a foreign national) you can still get whole life insurance. You will need to provide your agent with more paperwork to prove why you need the insurance. However, a common way to utilize whole life is to protect a property or for estate planning for non U.S. citizens, or a business or investment that you have made in the US. You have to be very careful with estate planning if you are a foreign national, because you might end up paying close to 40% of your assets to the government if you die. We will let you know everything you need to provide to get the best rating.  

A few examples of life insurance for non U.S citizens

  • We found an A+ rated life insurance company that pays a dividend of more than 7% that will insurance most non U.S. citizens. The dividend helps the death benefit and cash value grow very quickly.  
  • Also for higher risk cases, we found A+ rated companies that will insurance citizens from most countries.  
  • We have been able to provide whole life insurance for non US citizens even without a social security on some cases.  
  • Limited pay insurance for non Citizens or foreign nationals where you will only have to pay the premium for 10 years or 20 years, and keep the policy for ever.  

Our main area of expertise is with non U.S citizens and foreign nationals. We will help you to make sure you get the best chance for the best rating possible, with the best the life insurance companies out there.

Contact us with your questions and if you would like a quote. Click the following link if you would like to get a whole life insurance quote online. Fantastic tool to get instant quotes, however you need to make sure these quotes apply for you.  

Whole Life Insurance for Non US Citizens

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Foreign National Real Estate Tax Protection

By | Foreign Nationals | One Comment

A common scenario we see is where a foreign national purchased a property in the United States. If you are not a citizen of the U.S. and you don’t reside in the U.S. that means that you are a foreign national. It also means you will have to pay Estate Taxes.

What are Estate Taxes for Foreign Nationals?

Death Taxes essentially. If you pass away your estate tax exclusion is $60,000. That means as a foreign national you will not be taxed on the first $60,000. Yes, that is right you will have to pay taxes for everything that is worth more than $60,000 and is a local asset in the U.S. Talk to an international tax attorney or accountant to find out more about your specific situation.

Example:

A 45-year-old Brazilian investor buys a property in the U.S. for $250,000. He loves his investment because he can generate $24,000 per year in rent. And has no intention of selling the property.

What happens to my property if I pass away?

If and when you pass away, your family could owe a significant amount in taxes. Let’s say at death the market value of the property is $370,000.

The IRS gives your family 90 days to pay estate taxes on the property. Your kids and spouse have to quickly sell the property, which causes them to get less than what they normally would get. Let’s say they sell it for $350,000.

What are the estate taxes on a property worth $350,000?

Your family will have to pay %34 in taxes, after excluding $60,000.

So if your family sells at $350,000, they get $251,400. The IRS gets $98,600.

The Solution: Foreign National Real Estate Tax Protection

The Investor buys a permanent insurance policy for $98,600. The approximate cost of the life insurance would be $85/month.
At death the wife and family do not have to sell the property.

They present the insurance company with a death certificate, and the family will receive a tax-free check for $98,600. Then they send this check to the IRS to pay for the estate taxes.

Family gets a property worth $370,000 and rental income of $24,000 per year. The IRS gets $98,600 from the Insurance Company.

As you can see there is a huge benefit for having an insurance policy as a foreign national.

Which one would you prefer, paying $85/month or $98,600?

This problem becomes even greater if there is a mortgage on the property. Also you depending where you are from the life insurance companies will give you different ratings. How will my country be treated for life insurance?

If you have questions leave us a comment or email us at [email protected]

Foreign Nationals Mortgage Protection

By | Foreign Nationals | No Comments

You just purchased an investment property in the U.S. because you believe that the real estate market is undervalued. The reality is that if you pass away you may have to pay a lot of money to the IRS.

One of the reasons you purchased the property is because you wanted to take advantage of a low interest rate environment and get a mortgage on the property.

Let’s assume you are not a citizen, and you don’t live in the United States, then you are considered a foreign national.

Foreign Nationals with Properties in the U.S. need Life Insurance

  • You purchased a home for $500,000.
  • Your lender found you a foreign national mortgage for $250,000 at a around %5 interest rate.
  • Your monthly payments for the mortgage are approx. $1,700
  • You have the property rented for $2,000 so the rent pays for the mortgage.

What happens to the property if you pass away?

Let’s say that the property has not appreciated.

Your family will have to pay Estate Taxes on the property. Estate Taxes are essentially death taxes. Please talk to your accountant to find out how your Estate will be taxed!

When you die your family will need to come up with approximately $98,600 for Estate Taxes. This calculation comes using %34 in taxes, and the foreign national exclusion of $60,000. (Again these rules are very complex. This calculation will depend on what type of mortgage you have and many other rules. Speak to your accountant or tax attorney to find your exact numbers).

The IRS will need the payment of $98,600 in 90 days. Which leaves your family with very little control.

No Protection for Your Mortgage
Strategy 1: The typical scenario for Foreign Nationals.

Your family has to sell the property because you don’t have $98,600 to pay the Estate Taxes.
Lets assume that they can find a buyer for $500,000.
They will have to send the IRS a check for $98,600.
They receive $401,400 however they will have to pay the mortgage to the bank for $250,000.

They are left with a total of $151,400.

Protecting your Property from Estate Taxes

Strategy 2. Protection with Permanent Insurance for a Foreign National.

You did a great job planning and you purchased a permanent life insurance for $98,600 which will cost you about $85 per month (for a healthy 45 year old).

When you pass away:

  1. Your family sends the death certificate to the Life Insurance Company
  2. Your family gets a tax free check of $98,600
  3. Your family sends that payment to the IRS to pay your Estate Taxes
  4. Your family keep the house worth: $500,000 and they keep the monthly rent that pays the mortgage: $2,000 per month

Protecting your Mortgage and from Estate Taxes as Foreign National

Strategy 3. Protection with Term Insurance and Permanent Insurance:

Your life insurance agent did a great job and convinced you to purchase not only a permanent insurance for $85/month, but also a 30 Year Term insurance to protect the mortgage for approx. $60/month.

At death your family claims both the permanent and the term insurance:

  1. Sends the $98,600 tax free check to the IRS.
  2. Sends the $250,000 tax free check to the mortgage company.
  3. They keep the property worth $500,000 with no mortgage and they have rental income of $2,000 per month.

As you can see these strategies work very well under the right circumstances! Take control of your foreign nationals mortgage, and add a protection from estate taxes.

If you would like a quote and find out if this strategy works for you contact us here: [email protected]

Life Insurance Foreign National Asset

Life Insurance for Foreign Nationals as an Asset

By | Foreign Nationals | One Comment

Updated April 6th, 2017

First of all, most people think of life insurance as “death insurance”, but the truth is that life insurance can be used as an asset, in particular we are talking about permanent insurance (Universal or Whole Life).

Now, in the case of Foreign Nationals (people that are not considered residents of the U.S.), using a life insurance as an assets may even be more beneficial because of the tax benefits of the life insurance.
So if you would like more information on how to save money, grow your assets and utilize life insurance as an asset, just contact us.

Estate Taxes for Foreign Nationals

If you are a Foreign National you could end up paying up to 39% of your assets in the United States to the IRS when you pass away. The IRS will want their money in 90 days, which may force you to liquidate some assets at a very inopportune time. These rules are very complex, so talk to your accountant to find out which assets are included and how much you could en up paying in taxes.

Life Insurance for Foreign Nationals as an Asset

Permanent life insurance could be utilized as an asset. The way Permanent life insurance works is you not only have the death benefit, but you have a cash value portion that grows predictably, and this cash could be accessed at any time.
A good permanent life insurance could give you a rate of return between 4-5% tax free on your cash value (in the long run), and the death benefit protection.

Life insurance vs Other Investment

Here is a hypothetical scenario where two identical Foreign Nationals will utilize different strategies.

Client A: 45 year old male foreign national purchased life insurance and contributes 20,000/yr .
Client B: 45 year old male foreign national purchased an investment account and contributes 20,000/yr .

What would happen at death?

Client A: He has a tax free death benefit of $1,300,000 (multiple companies would offer this) if something where to happen to him.
Client B: His balance will go to his beneficiaries and they will have to pay estate taxes.

They invest for 10 years and die:

  1. Client A: Family will receive $1,300,000
  2. Client B: Family will receive the current balance of the account. Lets say he had a fantastic investment and did$350,000. and have to pay estate taxes. Let’s assume they have to pay 30% above $60,000. That would leave the family with $203,000.

This would be a $950,000 difference.

They invest for 20 yrs and die:

  1. Client A: Family will receive $1,600,000
  2. Client B: Family will receive the current balance of the account. Lets say he had a fantastic investment and did $1,000,000. and have to pay estate taxes. Let’s assume they have to pay 30% above $60,000. That would leave the family with $658,000.

It would be a $942,000 difference.

They invest for 35 yrs and die:

  1. Client A: Family will receive $2,700,000
  2. Client B: Family will receive the current balance of the account. Lets say he had a fantastic investment and did $3,700,000. and have to pay estate taxes. Let’s assume they have to pay 39% above $60,000 (now they need to pay more). That would leave the family with $2,220,400.

It would be a $479,600 difference.

You can access the Cash Value on the Policy

Finally, the cash value portion of the policy could be accessed at any time, and it will grow approximately between 4-5% in the long run (at current rates which may vary at any time).

In reality, this makes permanent life insurance a great conservative investment, with fantastic liquidity. One of the drawbacks however is that in the first few years, the policy will not build much cash, so you have to be aware of this down side.

If you would like to see how the cash grows please contact us for a quote.

Leave us a comment if you have any questions!

Foreign National Estate Taxes

Foreign National Investment in USA needs protection

By | Foreign Nationals | No Comments

Updated: August 16th, 2016. 

Most foreign nationals (non U.S. resident aliens) are not aware that their investment accounts are subject to estate taxes. Those estate taxes could add up to almost 40% of the accounts, and assets they hold in the US.

What are estate taxes for foreign nationals?

Imagine the estate tax as a Death Tax. Residents and citizens don’t have to pay estate taxes on their first $5.3 million (we are using Florida as an example, your estate taxes may change by state). That’s what we call the estate tax exemption, anything above $5.3 million they will have to pay estate taxes. However, the estate tax exemption for foreign nationals is only $60,000, anything above that will be subject to “death taxes”.

Foreign National Investment in USA:

I see many foreign nationals hold investment accounts in the U.S. for many reasons. People want to invest in a stable country, with a strong currency and a banking and investment system that works. But there are issues with these type of accounts.

For example let’s say you have an account with Morgan Stanley worth $1,000,000. If you were to pass away your family will have to pay almost $400,000 to the government in estate taxes. Please contact your estate planning attorney for a proper analysis of estate taxes and how to reduce your estate taxes.

That makes an Investment Account for foreign nationals very costly at the death of the owner.

Simple solution for Estate Taxes on Investment Accounts that may fit many people is life insurance. Life insurance can be a good way to protect from estate taxes by using the life insurance to pay for the taxes.

Let’s use the same example with the $1,000,000 in Morgan Stanley. For a healthy 50 year old, he could get a 10 year term insurance to pay the estate taxes. The cost would be approximately $40/month!

So you can either pay $400,000 at death, or protect your self for $40/month for 10 years.

An other issue is that as the if your accounts grow, so does the estate tax you will have to pay when you die, so it is imperative you protect your self not only for the taxes you would have to pay today, but also in the future if your assets were to appreciate.

Life Insurance as an Asset

There are also ways to make your life insurance an asset and not an expense. Under certain circumstances this you can benefit from a growing life insurance that will protect your investments from the inevitable estate taxes.

Please make sure you contact your estate planning attorney to find out how much of your assets are exposed to estate taxes.

Contact Us if you would like to find out if you can get life insurance to protect your investment accounts, or leave a comment if you have any questions.