全生命政策所有人通過了超過死亡利益的現金投降價值。受益人將獲得哪些金額？
全生命政策所有人通過了超過死亡利益的現金投降價值。受益人將獲得哪些金額？
 Another possibility is life insurance that has violated the corridors of risk and has been allowed to become, or was originally intended to be, a Modified Endowment Contract (MEC). The corridor of risk applies usually to universal life insurance type policies and it is the established maximum cash surrender value of the contract as it pertains to the amount of coverage and the age of the insured. The tests prescribed by the IRS limits what remains life insurance and what gets treated as a MEC. Regulations established in the 1980's limited this risk of abusing life insurance in this way because people discovered that universal life policies could be a great place to stash cash through the payment of excess premium in the flexible universal life policy, of which the IRS didn't like much When a life insurance policy becomes a MEC it is still a life insurance policy for death. Any pre-death distributions, however, cause the policy to be treated more like an annuity and distributions are treated as income first. That limits the use of the funds during the life of the insured. Life insurance treats policy loans as the payment of the basis (premiums paid in) first, and this feature is lost when a policy becomes a MEC. In fact, a number of tax-favorable benefits of life insurance are lost. To determine if a life policy has become a MEC, premiums are compared on a 7-pay test that helps establish the amount of premium, after paying 7 level annual premium amounts, that would pay up the policy in the first seven years after the life policy was issued. Being subjected to the 7-pay test or MEC test can occur well after the first seven years if there has been a material change in the policy. However, despite all of the latter, a life insurance policy that is stuffed with cash and violates the 7-pay MEC test down the road, has specific advantages even considering the disadvantages. One of those advantages is having more cash value than the face amount of coverage at death so you should also consider whether this life insurance became a MEC due to some specific financial or estate planning course of action taken by the decedent. Money at death under life insurance made to be a MEC are usually deliberate planning moves to pass cash or benefits of cash beyond the next immediate generation. For example, Grandpa wants to give each grandchild a sizable sum of money but wants to avoid generation skipping taxation. A MEC that pays as a death benefit is a contract paid, rather than money given. Check it out but this is another possibility for life insurance with too much cash value!
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