Surrendering Joint Life Last Survivor plan

[deanobeano]

Good evening all,

I wonder if you could give me your thoughts on the following:

My father in law (76 yrs old) took out a Joint Life Survivor plan many years ago.

This plan is currently run by Phoenix Life and is 100% invested in SCP (K) Managed Growth Life.

The plan was placed under trust in 2004 to his and his wife's children (myself included).

He would like to surrender the policy (as his estate has no need for the payment). He has been given a surrender value (aprrox 30k).

The documentation states that 'if the policy is written under trust, forms must be signed by all trustees and payment will be made to the trustees.

His first question is how can he get the payment made direct to himself?

Can the trust agreement be simply removed?

Getting the trustees agreement to this would be no problem and he wishes to do this to simplify any taxation that may be due on the surrender of the policy.

If you need any additional information, please let me know and thank you for your time.

[Ozzie Osmond]

deanobeano said:

The documentation states that 'if the policy is written under trust, forms must be signed by all trustees and payment will be made to the trustees.

Who are the trustees? That's your starting point. Trustees are not the same as potential beneficiaries.

[dalenorth]

Do you know what type of trust it is? I.e. Discretionary or absolute?

[Simpo Two]

Call Phoenix Life - they might have all the answers and it will cost nothing to find out from the horse's mouth. Or call the person who sold it to him, if there was one and they are still around.

[deanobeano]

Thanks for the answers.
My FIL is coming up next week and we will phone them together.

So far, my online research indicates that if the policy is surrendered whilst the owner is still alive then the funds can be paid to him and he will be responsible for any taxable gain over the premiums paid.