October 16, 2003

Cashing Out to Avoid Annuity Risk

By Brad Wolverton

Some charities transfer assets to insurers, but others dislike idea

Economic strains and financial-market uncertainties have prompted a growing number of charities to engage in a controversial, but potentially money-saving, practice: giving insurance companies the millions of dollars donated through charitable gift annuities and letting them assume the risk of investing the money. In exchange, charities keep about 25 percent of the annuity's value.

Organizations such as the

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