Wait and See Plan

Spouse Policy Purchase Option (SPPO)

$1,000,000 Life Insurance Policy

At Death

Receives $1,000,000 Death Benefit
(Usually not subject to income taxation)

Option A*

Less Estate Taxes

Option B**

Life Insurance Trust to Pay Estate Taxes

Under Option B:

Upon the insured's death, spouse receives a SPPO. This policy can be issued to an Irrevocable Trust*


Common Disaster Coverage

If the spouse dies within 30 days after the insured, SPPO rider is assumed to be exercised. Estate receives initial death benefit plus the maximum amount of SSPO insurance available minus the premium. If both spouses have base policies, the SSPO benefit is paid on both policies.

* The SPPO rider gives the person who is the Insured's spouse, at the time of the Insured's death, the right to purchase, without proof of insurability, a level amount of new paidup life insurance on his or her own life. The rider must be in effect at the time of the Insured's death. The Insured's spouse must also be living when the Inusred dies, and must be a beneficiary to whom all or part of the life insurance proceeds will be payable in one sum. A third party election endorsement is available which permits the designated owner beneficiary (which may be a trust), with the necessary insurable interest and with the consent of the surviving spouse, to purchase a paidup life insurance policy on the life of the Insured's spouse. The Insured's spouse (or the third party) can apply for the new paidup life insurance before the Company has paid the life insurance proceeds under the policy. However, the spouse (or third party) must apply within the 90 days after the Insured's death. This is our understanding of generally applicable rules. This is a general discussion of how the SPPO insurance coverage can work. See policy contract for all terms and conditions. We recommend everyone seek and rely upon the advice of his or her own professional advisors. The SPPO rider may not be available in all policies and it is not available in New York.

** This example is hypothetical and intended for illustrative purposes only and is not indicative of the actual performance of any particular product.



Subscribe to our Newsletter