Case study: Planning across jurisdictions 

PCS by Mercer client is in his 70s. He is the founder and CEO of a listed company with a market capitalization of over USD1.5B. A significant proportion of his assets are his listed shares which are held in a custodial account by a private bank. 

Our client is married with children. He is considering relocating overseas to be closer to his family.

1. If our client does relocate in future, he is concerned about how the jurisdiction’s tax legislation might affect the eventual wealth transfer to his family. 
2. How to diversify his asset holdings. 
3. How to manage capital erosion risks in the event of selling his shares and/or his family inherits them. 
4. When we met him, our client only held a small life protection policy which would have been absolutely inadequate in addressing his key challenges.

After thoroughly understanding our client’s unique circumstances, we recommended that he incept a Variable Universal Life policy (VUL). 

VULs allow some of the cash value accumulated to be invested into the market and earn a non-guaranteed return, and in this specific instance, the growth of the VUL insurance policy’s cash value is tax deferred in the jurisdiction to which the client is considering a move.

It’s important to note, policyholders may access their VUL cash value by making a withdrawal. However, if the cash value falls below a specific level, additional premium payments must be made to prevent the policy from lapsing.

Premium: USD 9,949,879 (shares, cash, and bank investments)

Sum assured: USD 15,058,000

• Each client and his/her needs are unique, and PCS by Mercer works to find the best solution in each circumstance. 
• High net worth lifestyles can be complex and across jurisdictions, so the solutions offered need to be efficient across the geographies concerned.