The SCIN-GRATThe SCIN-GRAT

Steven J. Oshins & Kristen E. Simmons

Estate planners can learn from financial planners. For years, financial planners have used hedging techniques to reduce risk or to guarantee a desired outcome. This is done by entering into a transaction that moves in the opposite direction as the first transaction in order to avoid or minimize a loss.

Estate planners often recommend life insurance as a hedging tool because it's the ideal solution for handling mortality risk. But what if life insurance is unavailable because the proposed insured is either too old or too unhealthy to qualify for a reasonably priced policy? What if a person wants to reduce the insurance need by handling part of the mortality risk with an advanced estate-planning strategy...