Additionally, an ILIT allows multiple beneficiaries to have an interest in the death benefits.

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The ILIT may make payments on the principal depending on the provisions of the loan agreement.

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The ILIT will borrow money each year to pay the life insurance premiums for that year.

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In a typical ILIT, a parent sets up a trust for his children.

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This is especially true of ultra-Orthodox communities close to the 1967 border such as Beitar Ilit and Modi'in Ilit.

ECONOMIST: Israel

In other words, an irrevocable life insurance trust (ILIT) can be used to purchase life insurance outside of the estate.

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In the rare case that the lender will call the loan, the guarantor may have to make payments on behalf of the ILIT.

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If the trustee decides to pay the interest annually, then gifts will have to be paid to the ILIT as the ILIT, for all intents and purposes, is the borrower.

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The aged rabbi also wants to be sure that as soon as the 90 days are up, building can resume in the two largest settlements, Beitar and Modiin Ilit, both sprawling Orthodox communities close to Jerusalem, just across the 1967 border.

ECONOMIST: Israel, the United States and Palestine