The holidays are often described as the most wonderful time of the year, but they can also feel complicated. We find joyful moments in family traditions and Christmas parties, but we’re also reminded of people we miss and relationships that aren’t as simple as we’d like. We navigate complicated family dynamics while juggling a hundred year-end responsibilities. This packed season moves fast; yet, it also pushes us to pause and consider all the people who rely on us.
That reflection makes this a perfect time to revisit something many folks put off: life insurance.
Can You Gift Life Insurance? Yes!
If you’ve never thought about giving life insurance as a gift, you’re not alone. It’s not going to make the lists for “Hot New Toys of 2025!” But the answer to the question “Can you really gift life insurance?” is yes. And, it may be one of the most lasting, thoughtful gifts someone could receive. At Henry Insurance, we help families, parents, and grandparents make smart, compassionate decisions every day, and gifting life insurance is one of the most powerful financial acts of love you can offer.
Why Life Insurance Makes Such a Thoughtful Gift
Most gifts are meant to be enjoyed right now. Life insurance, on the other hand, supports someone for years to come. It provides something you can’t wrap: long-term security. And in any economy, that’s an invaluable gift.
It’s the rare gift that actually keeps on giving.
Types of Life Insurance You Can Give
Different situations call for different policies. Our team of agents at Henry Insurance Services is happy to review the various avenues and discuss the best choice for you. Here are the most common options families choose when gifting life insurance:
Term Life Insurance
Term Life Insurance is a more budget-friendly choice that covers someone for a set period. If they pass away during that time, their loved ones receive a tax-free benefit, which can be invaluable during the initial grieving period.
Whole Life Insurance
Whole Life Insurance is a permanent policy that stays with them for life and builds cash value year after year. That value can be used later for college, a home purchase, or other big expenses. Many grandparents choose this option because it protects a child’s insurability early on.
Universal Life Insurance
Universal Life Insurance offers long-term coverage (like whole life) but with more flexibility. Premiums, benefits, and cash value growth can all be adjusted over time.
Ways to Give
- Buy a new policy for your child, grandchild, or another loved one.
- Transfer a policy you already own or update beneficiaries if your family has grown or changed.
- Convert an existing term policy into whole life to create a long-term asset.
Why Whole Life Policies Make Especially Good Holiday Gifts
Whole life insurance fits the holiday spirit more than people realize:
- It sticks around. Toys break, clothes wear out, but a whole life policy stays with them for life.
- It grows. The cash value increases every year, providing a future financial resource.
- It protects insurability. Buying early helps ensure they can get more coverage later, even if health issues arise.
- It teaches financial responsibility. When they’re older, they’ll understand the value of what you gave them and be more likely to pass that wisdom on to build generational wealth.
Tax Benefits to Keep in Mind
Depending on how you structure the gift, life insurance can come with some tax perks. Here’s a simplified breakdown based on common scenarios:
- If you give a paid-up policy, you may be able to deduct roughly its cash surrender value.
- If you gift a policy that you’re still paying for, you may deduct its current cash value plus any future premiums you cover.
- If you buy a new policy for a charity and list them as the owner, the premiums may be deductible.
- If you assign policy dividends to a charity, you may deduct the value of those dividends.
- If you purchase a policy to guarantee a charitable pledge and the charity is listed as both owner and beneficiary, the premiums may be deductible.
- If a charity is only named as a beneficiary on a policy you continue to own, the premiums generally aren’t deductible.
How to Gift a Policy with Henry Insurance
If you decide you want to give a life insurance policy this year, the process is much simpler than most people think:
- Look around. Review a few policy types and think about what would benefit your loved one most.
- Choose your approach. Decide on the amount of coverage or the type of policy.
- Talk with an agent. We’ll walk you through your options and help fit the policy to your budget and goals.
- Wrap it up. Just print the policy details and tuck them in a gift box with a bow.
- Explain the gift. After the surprise wears off, talk them through what the policy means and how you plan to fund it.
Gift a Lasting Legacy
Life insurance is probably never the first thing someone thinks to put under the Christmas tree, but it’s undeniably a great one. It’s one of the few gifts that will definitely grow in value for years – possibly even generations. If you’d like to discuss gifting a life insurance policy this year or simply want to explore your options for yourself, Henry Insurance is here to help.
If your list is:
- Comfort
- Protection
- Stability
You can rest assured it will be checked twice. This year, give life insurance.
