Till death do your money part as taxes?

Insurance proceeds, as you probably know, are NOT automatically exempt from death duty.

While there is an exemption threshold for residential property of up to $9 million, any payouts from mortgage protection plans taken up on the properties will be taxed should the mortgagor or borrower and policy owner die.

I didn't know that until I read today's BT on "Of Death and Taxes".

I bought the standard MDTA ie. mortgage decreasing term assurance to cover my property loan exposure. The plan's death benefit would go to pay down any outstanding home loan. But didn't know it would be taxable.

So what are the possible solutions?
All the solutions except for (d) essentially try to play with this specific rule:-

"The exemption threshold for financial assets is $600,000.
Insurance policies structured as trust policies under Section 73 of the Convenyancing and Law of Property Act are automatically exempt BUT each policy will be subject to the $600,000 threshold."

Briefly they are:-
a) Enter into a "cross life" arrangement ie. you buy for me and I buy for you.
b) Assign the policy to the mortgagee bank.
c) Take a joint life policy.
d) Set up a trust. (Not advisable.)

So much for now.