Gift acceptance policy
A gift acceptance policy defines organizational rules for receiving gifts, including insurance policies, to ensure compliance with legal and ethical standards. Nonprofits use these policies to specify which types of insurance gifts–such as whole life or term life–are acceptable.
The IRS requires documentation of accepted insurance gifts for tax reporting under Form 8283 if the value exceeds $5,000. Organizations reject insurance policies with outstanding loans or premium payment obligations due to financial risk.
Gift acceptance committees review proposed insurance donations using criteria like donor intent, beneficiary designation, and policy status. Policies mandate written acknowledgment for donors transferring ownership of an insurance contract, per IRS guidelines, according to a report from YourInsurance.info.
Charities require that they be named both owner and irrevocable beneficiary before accepting a donated life insurance policy. Annual reviews verify that accepted insurance gifts remain in good standing and comply with ongoing regulatory requirements such as state insurable interest laws (e.g.
New York Insurance Law §3205).
Can insurance agents accept gifts from clients?
Yes, insurance agents can accept gifts from clients. However, depending on the policy of their organization and local regulations, they may be limited in the value of the gift or its appropriateness to accept. Generally speaking, if an insurance agent is uncertain about accepting a gift from a client, it is best for them to…
See also Gift tax exemption, and Gift card insurance.