How to Donate Life Insurance Funds

January 17, 2023

Every year, millions of people donate cash and gifts in kind (i.e. goods and services) to their favorite nonprofit organizations (NPOs) and charities. These tangible gifts are most definitely appreciated by the receiving organizations. However, if you ever found yourself wishing you could do more as a donor, assets like life insurance are a convenient type of donation that can make a profound impact on a cause you care about.

For the level of impact they have, donations of life insurance funds are surprisingly simple to arrange. There are two main ways you can make a donation through life insurance: naming the NPO as a beneficiary on the policy or transferring ownership of the policy to the NPO.

Naming an NPO as a Beneficiary on a Policy

You can name a charity or NPO as a beneficiary on a life insurance policy. This is as easy as submitting a new beneficiary designation form to your insurance company using the NPO’s legal name and federal tax ID number. This option gives you a lot of flexibility – you can name the NPO as a primary beneficiary for the full amount of the policy’s benefit, or as partial beneficiary for a percentage or specific amount of the policy’s benefit. You can also name the charity or NPO as a contingent beneficiary so that they only receive the benefit if your primary beneficiary doesn’t survive you.

This is a good option to consider if you have an existing life insurance policy that has outlasted its original purpose (for example, to provide for children who are now financially independent adults). You still control the policy and can use its cash value or change the beneficiaries whenever you want. However, because you still own the policy and its cash value, you don’t receive any tax benefits just by naming an NPO as a beneficiary.

Transferring Ownership of the Policy to an NPO

Alternatively, you can “gift” a life insurance policy outright by working with your insurer to transfer ownership of the policy to the NPO. With control of the policy, the NPO can use it however they need – they can name themselves as the sole beneficiary or access the policy’s cash value for immediate use.

Transferring ownership of a life insurance policy to an NPO entitles you to charitable contribution tax deductions. The policy’s value is also removed from your estate for estate tax purposes. Plus, any payments you make toward the policy’s premium on behalf of the NPO after the transfer are tax deductible. However, unlike changing your policy’s beneficiaries, transferring ownership of the policy is permanent – so make sure to talk with your financial advisor to see which option is best for you.


If you’re interested in leaving a legacy by donating a life insurance policy, consider giving to Miami Jewish Health so that we can continue our mission of providing innovative health services and lifestyle programs for aging adults. If you have already named Miami Jewish Health as beneficiary of a life insurance policy or other assets, please contact Alison Grewe at or 305-803-3056 today. We would be honored if you would notify us of your decision so that we can carry out your wishes and thank you.


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