6.3.5.3 Life Estate Beneficiary Treatment

A Life Estate Beneficiary (LEB) can use the deposit assets during their life and the ownership is changed upon death. This person has the right to receive income from the trust or to use the trust assets before all other beneficiaries. The beneficiaries who inherit the estate after the LEB are called Remainder beneficiaries. FDIC provides coverage to both Life Benificieries.

The stake of the LEB is intangible. The FDIC allocates insurance to LEB in the following way:

• A fixed amount of SMDIA under REV ORC
• (A Factor * Trust amount), under IRR ORC (Factor based on IRS Actuarial tables)