The Role of Insurance in Legacy Planning
More Than a Payout: Using Insurance to Shape What You Leave Behind
When most people think of life insurance, they think of it as a simple death benefit: money that goes to loved ones when they pass. But in the context of legacy planning, insurance does far more than just replace income. It becomes a tool for intention—a way to shape how you're remembered, support causes that matter to you, and provide a financial structure that brings clarity instead of chaos.
Here’s how insurance can play a meaningful, strategic role in your legacy plan.
Clarifying What Legacy Means to You
Legacy planning isn’t just about money—it’s about meaning. It’s about what you want to pass on, to whom, and how.
Ask yourself:
Who do I want to support after I'm gone?
What values do I want my financial legacy to reflect?
Are there specific needs—education, care, charity—that I want to address?
When you can answer those questions, you can begin to align your insurance strategy accordingly.
Life Insurance as a Legacy Vehicle
Life insurance offers one of the most efficient ways to transfer wealth—often income-tax free and outside of probate. But its role goes beyond liquidity.
Here’s how life insurance can help:
Create an instant estate: For families without large assets, insurance can build a legacy quickly and efficiently.
Equalize inheritances: For example, if one child inherits the family business, a policy can provide balance to other heirs.
Protect heirs from debt or estate taxes: Permanent life insurance can provide the liquidity needed to pay obligations without forcing asset sales.
Support charitable giving: Policies can be used to fund legacy gifts to nonprofits, churches, or schools through a donor-advised fund or charitable trust.
The key is intentional structure. Without planning, your legacy can be subject to delays, taxes, or disputes.
Using Insurance to Protect What You’re Passing On
Your legacy doesn’t just depend on what you leave—it depends on what you’re able to preserve.
That’s where the following types of insurance come in:
Long-Term Care Insurance
Helps prevent the depletion of assets intended for heirs.
Allows you to receive care on your terms while preserving the estate you planned to pass down.
Disability Insurance
Ensures that a long-term illness or injury doesn’t derail your ability to fund your legacy in your prime earning years.
Umbrella Liability Coverage
Protects assets and future wealth from unexpected lawsuits or claims.
These “supporting” policies aren’t often thought of in legacy planning—but they’re critical protectors of your intent.
Coordinating Insurance with Your Estate Plan
Your insurance strategy should align with your will, trusts, and beneficiary designations. This ensures:
The right people receive the proceeds.
The right structures (such as trusts) are in place to manage distributions.
The plan works in harmony—not conflict—with your estate attorney’s design.
At Stahlnecker Wealth Management Group, we work closely with attorneys, tax professionals, and estate planners to ensure everything fits together.
Real Families, Real Impact
We've seen firsthand how families use insurance to:
Fund education accounts for grandchildren
Cover caregiving costs for aging parents
Leave gifts to churches, charities, and alma maters
Provide financial security to adult children with special needs
In each case, the policies were more than transactions—they were instruments of care, purpose, and intentional generosity.
Thinking Ahead, Acting Now
The best legacy plans are those made before they’re needed. Life changes—so should your plan.
If you haven’t reviewed your insurance in a while—or if you’ve never thought about its role in your legacy—we’d be honored to walk through it with you.
Let’s start the conversation.
And if you’re not sure where to begin, our Financial Fire Drill™ is a great place to identify gaps, priorities, and opportunities to protect your legacy.
