At present, there are two common insurance trust models.
The first mode is that the insured sets up a trust to buy insurance for himself, and the beneficiary of the insurance contract is set as the established trust.
In the second mode, the client sets up a trust, and the trust company acts as both the policyholder and beneficiary of the policy, and the client acts as the policyholder of the policy. Trust companies pay premiums and manage insurance policies on behalf of trustees. When the principal (that is, the insured of the policy) dies, the trust company manages the claims for the principal. In the second mode, the client puts part of the property into the trust in advance, resulting in the effect of debt isolation. If the principal has debt risk in the future, the assets invested in the trust will not be used for debt repayment (provided that the trust is legally established and there is no malicious evasion of debts), thus avoiding the interruption of premium payment caused by the use of assets for debt repayment. In addition, according to different types of insurance, insurance trusts can also be divided into death insurance trusts and survival insurance trusts. Death insurance trust means that after the death of the insured, the insurance money will enter the trust account. Survival Trust means that when the insured survives, the survival fund and insurance dividends enter the trust account and are managed and operated by the trust company in a unified way.
The difference between insurance trust and family trust mainly lies in different trust scope, different capital requirements, different leverage and different debt isolation.
1, different leverage: Compared with ordinary family trusts, insurance trusts can use insurance leverage to enlarge their wealth and exchange less premiums for the insured amount.
2. The scope of trust is different: the scope of family trust is wider than that of insurance trust, including cash, equity, creditor's rights, real estate and valuables in addition to contractual income rights. 3. Different capital requirements: the starting point of family trust funds is 6,543,800+million according to the minimum regulatory requirements, and the requirements for insurance trust funds are lower. The entry threshold is set according to the total premium or total insurance amount. Usually, the insurance trust can be carried out if the insurance amount is more than 5 million.
4. Debt isolation is different: the assets entering the trust are isolated from the assets of the client. For the insurance trust, the isolation function of the trust cannot be reflected before the insurance claims are settled, that is, before the insurance money enters the trust.