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Technically, you are correct. It is Dad's asset. However, since this is a long term happily married couple, the reality is that professionals would view this as a married couple estate with all asset going to the wife tax free at the husband's death. Estate planning assumes the wife gets the asset so it actually is part of the couples estate. The will and the trusts have a chain of beneficiaries who don't own the life insurance but will benefit from it.

So, I say our estate plan includes $950,000 of death benefits and eventually more than $1,000,000 in CSV when we reach our nursing home age. Technically, the wife owns all of half and we share the rest.

If you own a small business valued at $30 million and have a life insurance policy of $5 million to cover estate taxes then the business and the life insurance are assets of your estate, a trust or community property, etc. It is all generically called family estate planning.

Divorce blows up the entire estate plan and then the assets must be segregated.
Redondo Beach Mike
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