Upon accumulating a large amount of wealth, it is commonly necessary to find a means to protect it.  There are many unscrupulous people who have nothing to lose by suing you and a lot to gain.  The Cayman Islands is one of the most sought after asset protection center, next to perhaps Panama.

The most common method used to protect your assets is an offshore account and trust.  This is usually done in the form of trust funds and protected accounts.  But aside from this, there are still options to protect your assets.  Some of these options are even cheaper, safer and more convenient then offshore trust accounts.

In some financial centers, insurance and annuity policies are used as means of asset protection.  In Switzerland and Liechtenstein, it is very common to encounter these types of arrangements.  In these arrangements, offshore investors are protected and all information kept secret in the same way and sometimes can be better than offshore trust and bank accounts from the jurisdictions like the Bahamas and Cayman Islands.  Other countries like Panama have bearer share corporations which for all intesive purposes are equivalent to the now defunct numbered bank accounts that Switzerland used to offer.

The most favorable advantage of insurance policies compared to trust accounts is that it looks totally natural.  Unlike opening an offshore trust account, purchasing an insurance policy is less controversial.  In addition, taxation is likely to be avoided on insurance policies unlike bank and trust accounts, which many countries try to make taxable by writing rather rediculous and far reaching laws (like the United States, Canada, and the EU).  Other than life insurance policies, only countries like Panama have a good solution because they off bearer share corporations.

An insurance policy can even be used as a replacement for trust.  If you group investments under one policy, it becomes very convenient for you to assign this under an offshore trust.  Since the trust can hold any asset, it could then readily be used to hold an insurance or annuity policy.   The most common method used to protect your assets is an offshore account and trust.  By protecting your investment under an insurance policy and a trust together, you get the protection of both methods added together.  This type of arrangement is often referred to as layering.  A layered approach is also much more flexible beause it given much more warning when an attack of your funds is under way.  The attacker can't break through both the life insurance policy and trust at the same time.  This gives you time to take action to further protect yourself by moving the ssets elsewhere.  Also, your wealth under a policy is less likely to be investigated by revenue bureaus.  This is because these assets will be owned by the insurance company.

Protecting your investments through an insurance policy is somewhat a better option compared to a trust account, but it seldom matters which method you apply.