Life Insurance Trends Among Celebs: Protecting Their Legacies

Celebrities and film stars lead privileged lives—spectacular homes, expensive cars, designer clothes, and holidays at exotic destinations are all integral to their lifestyles. However, behind all the sparkle lies some prudent financial planning. Celebrities often experience dynamic careers with exciting opportunities and varied fortunes; hence, securing their family’s future in case of any eventuality remains a high priority. This is where life insurance fits the bill perfectly for wealth transfer and continuation of their legacies.

Life insurance—once considered a retirement tool—has now gained popularity in celebrity circles as a means to pass on wealth to descendants and good causes. Celebrities assign chunks of their insurance proceeds to philanthropic foundations to sustain their charitable work.

Let’s look at some emerging life insurance trends among celebrities:

Customised High-Value Policies

Big celebrities take life insurance policies ranging from Rs. 10 crores to Rs. 500 crores or more based on their incomes and asset holdings. Top film stars, sports superstars, models, and business people command exceptionally high career valuations due to movie remuneration, endorsement fees, events, etc. Their life insurance sum assured is aligned to these elevated incomes so that their beneficiaries continue enjoying similar lifestyles and wealth levels in case of any unfortunate event.

Holistic Coverage Across Needs

Insurers offer customised life insurance solutions that cover various risks—death, accidents, critical illnesses, loss of income, disabilities, etc. Remarkable riders are added to base policies that provide relevant coverage to different individuals' needs.

Many celebrities undertake risky stunts for movie projects or play contact sports. Hence, injury covers add an extra layer of safety. Comprehensive insurance across health and life risks protects celebrities and their families.

Planning For Continuity

The show must continue – celebrities realise that their demise or disability should not stall or impede their ongoing projects and commitments. Many production houses take critical man insurance covers on lead actors, directors and technicians. Celebrities backing startups or co-producing films also opt for insurance policies so that such business agreements are honoured seamlessly in case of their absence. Even the extensive philanthropy that some celebrities support through foundations and NGOs should continue unhindered, for which insurance planning becomes essential.

Mitigating Financial Risks

Despite the crores celebrities earn at their peak, their finances are still prone to various risks. Celebrities may carry significant debt levels across personal or production loans that require uninterrupted servicing. By ring-fencing such liabilities under insurance, the financial stability of their estate can be maintained. Similarly, many celebrities may have invested in speculatory ventures or startups that can fail and lead to losses.

Adequate life coverage allows celebrities to absorb such reversals and retain overall wealth for their families. Lastly, celebrities also owe it to their beneficiaries to provide lifestyles similar to what they’ve been accustomed to.

Tax Benefits

A favourable side effect of taking extensive life insurance policies is the associated tax advantages. The premium payments towards policies qualify for tax breaks under Section 80C of the Income Tax Act, which allows substantial tax savings during the term and on maturity. For those exploring modern insurance solutions, learn about ACKO Insurance, a new-age insurance company today.

Wealth Management

At its core, these insurance policies are adopted for prudent wealth management and estate planning. With fortunes that can fluctuate and careers that see early peaks, celebrities recognise that wealth creation alone is insufficient. Systematic wealth transfer to beneficiaries and good causes through insurance and accompanying structures like trusts are crucial.

Celebrities may own luxury assets - designer homes, flashy cars, vintage collectables, etc., that they want to preserve for subsequent generations. Substantial life insurance covers and allows the retention of such lifestyle assets. For them, wealth management goes hand in hand with succession planning.

Conclusion

Many celebrities adopt life insurance, serving as role models for the general public to consider essential coverage for family protection. Adopting rates are expected to increase with the availability of customised policies, tax advantages, and estate planning benefits linked to insurance. Celebrities' preference for comprehensive life coverage highlights the importance of life insurance for financial well-being across all walks of life.

(No Hans India Journalist was involved in creation of this content)