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
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