For qualified purchasers
Tax-inefficient assets don't have to stay tax-inefficient.
Institutionally priced life insurance that lets qualified purchasers hold tax-inefficient strategies inside a policy wrapper — where it genuinely fits, and only there.
In Drew’s Words
Private Placement Life
Simply Explained
Some of the most attractive investment strategies are also the most tax-inefficient. High-turnover funds, certain credit and hedge strategies, and anything throwing off short-term gains or ordinary income can lose a substantial share of their return to tax before it ever reaches the investor.
Private placement life insurance is a variable universal life policy offered privately to accredited investors and qualified purchasers. Assets held inside the policy grow without annual tax drag, and the death benefit is generally received income-tax-free. Because it is sold privately rather than retail, the cost structure is institutional and transparent instead of commission-loaded.
The constraints are strict and they are not negotiable. The policy must satisfy the definition of life insurance under Section 7702, diversification requirements under Section 817(h), and the investor-control doctrine — which means you cannot direct the specific investments inside the policy. It also requires real life insurance need and a long holding period to work.
How It Works
Eligibility and fit
We confirm accredited investor and qualified purchaser status, and — just as important — whether there is genuine insurance need beyond the tax treatment.
Structure
Carrier, jurisdiction, and ownership structure are selected together, since ownership drives the estate tax result as much as the income tax result.
Funding design
Premiums are designed against Section 7702 limits, balancing the tax benefit against the insurance cost.
Ongoing oversight
Policy performance, cost of insurance, and continued compliance with diversification rules are reviewed annually.
Who this is for
- Qualified purchasers with a meaningful allocation to tax-inefficient strategies
- Families with a genuine, long-term life insurance need alongside the tax objective
- Investors with a holding horizon measured in decades rather than years
Who this isn’t for
- Anyone who does not meet accredited investor and qualified purchaser thresholds
- Anyone who may need the capital back in the near term — early access undermines the entire structure
- Anyone whose interest is purely tax-driven with no underlying insurance need
Questions
Can I choose the investments inside the policy?
No — and this is the point most often misunderstood. Under the investor-control doctrine, a policyholder who directs the specific investments inside the policy risks being treated as the owner of those assets for tax purposes, which forfeits the entire tax treatment. You select an investment manager or strategy; you do not direct individual holdings.
How is this different from a retail variable life policy?
Cost structure and investment access. PPLI is negotiated and institutionally priced, with transparent fees and no retail commission load, and it can access strategies unavailable in registered products. The tradeoff is that it is only available to accredited investors and qualified purchasers, with meaningful minimum funding commitments.
What if my circumstances change and I need the money?
Withdrawals and loans are possible but they interact with the policy's tax treatment in ways that can be costly, and surrendering early generally destroys the economics — the upfront and insurance costs need years of tax-free growth to be worth carrying. PPLI should only be funded with capital you are confident you will not need.
Related services
Planning rarely stops at one decision. These are the pieces that most often sit alongside private placement life insurance.
- Premium Finance for Ultra-High-Net-Worth Families
Financing the premiums on substantial life insurance so committed capital stays committed — designed conservatively, stress-tested, and reviewed every year.
- Tax Planning
Your investment decisions and your tax strategy, built by the same team, under one roof — instead of an advisor and a CPA who've never spoken.
- Estate & Trust Planning
Wills, trusts, and beneficiary designations coordinated with your actual financial plan — reviewed and implemented under one roof alongside our legal counsel, not left to gather dust.