Wealth transfer insurance

Insurance and trusts are often utilized for estate planning purposes. Most often these structures are used for the following reasons:
 * 1) To pay estate tax;
 * 2) Concern of leaving a large sum of money unsupervised to a minor or an irresponsible adult.
 * 3) Asset protection for beneficiaries.

Wealth transfer insurance structures
A type of life insurance on two people (usually married) that provides benefits to the heirs only after the last surviving spouse dies. This differs from regular life insurance in that the surviving partner doesn't receive any benefits after their spouse dies. Thus, second-to-die insurance is used for estate planning. Parents who take out this type of insurance are thinking of their children, not themselves. For example, it could be designed to pay estate taxes or support any surviving children. It is also called "Dual-Life Insurance" and "Survivorship Insurance".
 * Second-to-die insurance: investopedia says:


 * Irrevocable insurance trusts investopedia says:

An irrevocable trust set up with a life insurance policy as the asset, allowing the grantor of the policy to exempt asset away from his or her taxable estate. Once the life insurance policy is placed in the trust, the insured person no longer owns the policy, which will be managed by the trustee on behalf of the policy beneficiaries when the insured person dies. The insurance trust, or irrevocable life insurance trust (ILIT), is often used to set aside cash proceeds that can be used to pay estate taxes, as the life insurance policy should be exempt from the taxable estate of the decedent.

One catch on the insurance trust is that the life insurance policy must be transferred to the trust at least three years before the death of the insured. To get around this rule, a new policy can be taken out with a spouse as owner, then placed in the trust. As an irrevocable trust, changes can only be made by beneficiaries; the owner gives up all control to the trustee. If the size of the taxable estate is below the maximum exclusion figure, it is generally not necessary to set up an insurance trust; in this case the life insurance will be included in the decedent’s taxable estate.