Planned and Legacy Giving
A life insurance policy that is no longer necessary or no longer serves its original purpose can be easily repurposed to support the work of the Foundation.
A donor wishing to gift some or all of their life insurance policy benefits can participate in Aga Khan Foundation Canada’s (AKFC’s) Planned and Legacy Giving (PLG program) in one of two ways:
(a) By naming AKFC as a beneficiary of a life insurance policy; or
(b) By naming AKFC as a beneficiary of a life insurance policy and transferring ownership of the policy to AKFC.
Benefits of Leaving a Gift of Life Insurance to AKFC
- Depending on the giving strategy used, you or your estate may be eligible to receive a tax credit for your gift of life insurance.
- You may be eligible to receive a tax credit for your life insurance policy premiums.
- The life insurance policy proceeds can bypass your estate, allowing the proceeds to reach AKFC sooner with less administrative complexity compared to leaving a gift to AKFC through your will or estate.
Lalao learned raffia weaving through a vocational training program supported by AKF and Canada, which aimed to support gender equality through women's economic empowerment. Credit: Muhammad Khan / AKFC
How to give a gift of Life Insurance
Before making a decision, consult with your financial, tax, and legal advisors.
- Designate AKFC as the beneficiary of an existing life insurance policy: You can leave the proceeds of an existing life insurance policy or a percentage of it to AKFC while retaining ownership of the policy and continuing to pay the premiums. Your estate will typically receive a charitable tax receipt for the amount donated to AKFC.
- Designate AKFC as the beneficiary of a new life insurance policy: You can leave the proceeds of a new life insurance policy or a percentage of it to AKFC while retaining ownership of the policy and continuing to pay the premiums. Your estate will typically receive a charitable tax receipt for the amount donated to AKFC.
- Designate AKFC as the beneficiary of an existing life insurance policy and transfer ownership to AKFC: By transferring ownership of the life insurance policy to AKFC and naming AKFC as the beneficiary of the policy, you can receive a charitable tax receipt at the time of the transfer. While you are responsible for paying any remaining premiums, you may qualify for tax credits for premiums you pay after the transfer of policy ownership to AKFC.
- Designate AKFC as the beneficiary of a new life insurance policy and transfer ownership to AKFC: By transferring ownership of a new life insurance policy to AKFC and naming AKFC as the beneficiary of the policy, you can receive a charitable tax receipt at the time of the transfer. While you are responsible for paying any remaining premiums, you may qualify for a tax credit for the premiums you pay.
- Designate AKFC as the beneficiary of a new life insurance policy and transfer ownership to AKFC: By transferring ownership of a new life insurance policy to
AKFC and naming AKFC as the beneficiary of the policy, you can receive a charitable tax receipt at the time of the transfer. While you are responsible for paying any remaining premiums, you may qualify for a tax credit for the premiums you pay.
Beneficiary Designations: Typically, beneficiary designations are made with your life insurance policy provider. You may also have a will that refers to life insurance policies if you are using life insurance as part of your estate plan. It is therefore essential to ensure that you are consistent across all of your estate planning documents with respect to the beneficiary designations for your life insurance policies to avoid potential issues for your estate later on.
Other considerations
Any decision you make with respect to giving a gift to AKFC in your will as part of your planned and legacy giving should be made in consultation with your financial advisor, tax advisor, and legal advisor.
Donors should also take the necessary steps to ensure that they have made adequate provision for their family, heirs, and other individuals requiring support after their demise.
We would welcome the opportunity to work with you, your family and your advisors if you wish to support AKFC through a gift in your will. We encourage you to engage in a discussion with us prior to finalizing your gift, to ensure that it is a gift that AKFC can accept as a Canadian charitable organization. From time to time, AKFC may have to decline gifts that are made without prior consultation.
Give an Outright gift of a new policy
Do you want to make a gift to support Aga Khan Foundation Canada without using current assets?
You can purchase a new policy on your life and irrevocably name the Aga Khan Foundation Canada as the owner and beneficiary. Once the policy has been gifted to the Foundation, you will support the policy until maturity by making the premium contributions to the Foundation who in turn will pay the insurance company. Contributions made to the Foundation are generally tax-deductible.
