You should probably not own your life insurance policy if you have a taxable estate. The reason is, is that there is a mechanism for creating a trust that will own the life insurance policy, and not add to the estate tax burden to your estate. It is very important, however, that you put the life insurance policy from its inception in the name of the trust instead of owning it directly. Otherwise, any transfers to the trust after ownership or creation of the policy will require a three-year waiting period before it is out of your estate for tax purposes.