Private Placement Insurance Products: Exclusive and Flexible Opportunity for High Net Worth Clients

Because they can only be offered to individuals who are qualified purchasers and accredited investors, private placement variable universal life (PPVUL) and variable annuities (PPVA) offer high net worth clients access to both investment alternatives and customized product designs that are difficult or impossible to obtain in traditional retail or registered products. They are optimal in their use as a tool to address a multitude of financial, income, and estate tax planning objectives. With its preferential treatment from an income tax perspective, insurance must be properly structured in order to assure it maintains its tax benefits. Clients should work with brokers experienced in structuring policies for high net worth clients and in working with multiple insurers to obtain the most favorable underwriting outcome.

Here, an outline of  PPVUL and PPVA insurance products; the advantages they offer both as financial products and over traditional insurance products, and some important considerations for potential buyers.

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