Only about 8 percent of Americans leave gifts to charity when they die.
As a result, the Prudential Insurance Co. has developed a life insurance policy that it says will make such giving a breeze. But some estate-planning experts say it's just a gimmick.
The policy is called Charity Plus, and some agents have started selling it.
Under Charity Plus, when a person buys a Prudential life insurance policy, he may be offered a second, smaller policy to benefit a favorite charity. The death benefit can range from $2,500 to $10,000.
Prudential says the policies are cheap: A 35-year-old man, for example, could get a $5,000 Charity Plus policy for $72 a year.
But there are better ways to give, experts say. You could simply donate a set amount each year while you live. Or you could invest a set amount each year and leave the entire investment to your charity.
A third option is to increase your current life insurance policy and leave the extra cash to your favorite non-profit group. That strategy would be cheaper than taking out a second, small policy specifically for your charity.
Over a normal lifetime, the annual premiums paid into a Charitable Plus policy might exceed the death benefit paid to your charity, once interest payments and inflation are factored in, said Rich Stevens, manager of personal financial services at Price Waterhouse in Philadelphia.