Liquidity Risks of Illiquid Assets in PPLI

Offshore Tax with HTJ.tax · May 18, 2026 · 1m

Private Placement Life Insurance (PPLI) is often praised for its tax efficiency and flexibility—but when illiquid assets are placed inside the structure, a different set of risks emerges:👉 Liquidity risk.This is especially important for policies holding:• Private equity • Real estate • Venture capital • Hedge funds with lock-ups • Other hard-to-sell investments⚖️ 1️⃣ The Core IssueInside a PPLI policy:• Assets are held within the insurance wrapper • The policyholder does not directly control liquidation timing👉 That becomes problematic when:• Cash is needed quickly🏦 2️⃣ Illiquid Assets Cannot…