Can You Donate a Life Insurance Policy to Charity?

If you’re philanthropically inclined, you can contribute your life insurance to a 501(c)(3) public charity, like a donor-advised fund. There are two primary methods to contribute life insurance to charity, and each one has different timing and tax benefits. Using a case study, the two options illustrate how donations can maximize the charitable impact. 

By contributing your insurance policy during your lifetime, you’re able to use the value of the policy to benefit your favorite causes, while also claiming a current-year income tax deduction (if you itemize) and potentially reducing your estate tax liability.