Why Go International with Fidelity?

For several decades, insurance companies have provided unique opportunities for successful individuals to reduce taxes, in some circumstances, through tax-free investment growth, tax-free distributions and tax-free death benefits. In addition, some international insurance companies have offered lower insurance cost and greater investment flexibility than many domestic carriers.

While there are advantages to using international insurance strategies, American taxpayers have the unique responsibility of having to report and pay taxes due on worldwide income. While many international insurance companies are happy to offer their products to American taxpayers, not all are willing to comply with IRS and U.S. Treasury Department requirements, thereby putting the American taxpayer at risk.

For that reason, Fidelity Insurance Company, Ltd. (Fidelity) was formed to cater to the needs of successful U.S. taxpayers, offering tax reduction and investments through U.S. Treasury and Internal Revenue Code compliant international insurance strategies.

Here are some of the features that make Fidelity the best choice for international insurance structures:

• Tax Benefits

For as long as there have been income tax laws in the U.S., insurance products have enjoyed favorable treatment. If properly structured and managed, the assets inside a life insurance policy benefit from tax-free accumulation of investment gains, distributions of basis and earnings can be taken from the policy in the form of a tax-free loan over the life of the policy.  At the time of death, the death benefit receives a stepped-up basis for tax purposes, which means the death benefit can be passed on to the insured’s estate tax-free.

Annuities also enjoy the tremendous advantage of tax-free accumulation. An annuity is a great investment for many clients who need tax-free accumulation, but do not qualify for or need life insurance. It is important to know, however, that distributions from an annuity are taxed as ordinary income, and distributions at the time of death of the insured are taxable.

• Asset Protection

In some states, the assets of life policies or annuities cannot be included in bankruptcy judgments and cannot be seized by U.S. courts.

• Death Benefit

Life insurance is often used to provide security for the family and estate of the insured. Upon the death of the insured, proceeds are used for such things as income replacement, debt retirement, buy-sell agreements, and the payment of estate taxes.

• Segregated Accounts

As an international insurance company under the laws of Anguilla, British West Indies, Fidelity life policies and the assets of annuities all enjoy the benefit of segregated account legislation. This means, by law, the investment portion of the life policy and the assets of annuities are held separately from those of the company and the company’s other clients. Assets are not commingled and are therefore not at risk should a creditor attempt to attach the funds of another client or the insurance company.

• U.S. Treasury Department and Internal Revenue Code Compliant

Fidelity provides unique insurance structures tailored to the individual client.  These structures are reviewed annually by the prestigious law firm of Handler, Thayer & Duggan, LLC to ensure that all policies and structures adhere strictly to all applicable Internal Revenue Code sections, modifications in the code, and Revenue rulings. Fidelity clients can rest easily knowing that they can enjoy the benefits of international planning while investing in U.S. compliant products.

• Greater Number of Investment Options

Unlike U.S. carriers who mass market a small group of investment options, Fidelity offers a virtually limitless number of investment options in a U.S. compliant policies.

A client may choose an investment manager who has already established a relationship with Fidelity. Fidelity also allows clients to recommend a money manager of their choice, as long as that manager meets Fidelity’s high standards. Fidelity will perform its due diligence, and if warranted, will approve the manager.

• In-kind Payments

As an international insurance company, Fidelity may accept a portion of the premium payment in the form of “in-kind” payments. In-kind payments are payments made with non-liquid assets, defined as assets that cannot be turned into cash within 60 days. This advantage opens the door for payments to be made with a wide variety of assets, including fixed assets and private stock.

• Reduced Premium Taxes

There are no state premium taxes on foreign issued life insurance policies.  In some states, premium taxes can be as high as five percent(5%) on domestic life policies.   However, foreign life insurance policies issued to U.S. taxpayers are subject to only a one percent (1%) federal excise tax.  Fidelity also enjoys reduced regulatory costs.  U.S. carriers must bear the expense of meeting compliance requirements for as many as fifty state insurance commission.   Fidelity is only required to meet IRC and the national insurance regulator requirements.  These savings are passed directly on to the policy owner.

• Immediate Low-cost Loans

With a Fidelity life policy, distributions in the form of a loan or return of basis may be taken tax-free from the first day forward. Domestic carriers typically restrict loans for the first few years and/or offer loans at a higher interest cost.

• Other Savings

There are several ways that Fidelity operates in a more cost effective manner than domestic carriers.  By choosing to not to do business in the U.S., Fidelity is not subject to the high cost of corporate income tax or the regulatory burden imposed by each of the 50 states different insurance laws and regulations.  Fidelity runs an efficient, cost effective operation that is dedicated, not to marble towers and exorbitant salaries, but to serving its clients.

• Anti-Money Laundering

Fidelity strives to be a leader in complying with all "Anti-Money Laundering" laws, "Know Your Customer" requirements, PATRIOT Act rules, and Caribbean Financial Task Force initiatives.

To find out more please contact us:

Email: clientserv@fidinsco.com

The Law Building
PO Box 687, The Valley
Anguilla, British West Indies

Phone:   264- 497-0484

Fax:   264- 497-5753