.they can be beneficiaries if they are over 21 years and do not require a trustee. 3. Parents. They are usually named as life insurance beneficiaries for various reasons such as 步天连连看

10 Nov

Insurance A life insurance beneficiary is the person who is supposed to receive your insurance benefits after your death. The proceeds of a life policy are received by the beneficiary without taxation. Life insurance policies require that when you give a name of a beneficiary, you should also indicate the portion of the proceeds that he/she should receive. Types of life insurance beneficiary There are three different types of beneficiaries in life insurance policies who are eligible to receive death benefits. They include: Preferred beneficiary: this can either be a spouse, parent, child or grandchild hence if the insured has any preferred life insurance beneficiary then the benefit is protected from creditors. Contingent beneficiary:this is the person who will receive the death benefits if the primary beneficiary dies before or at the same time as the insured. In case there is no contingent beneficiary, the proceeds are passed to the estate. Life insurance beneficiaries can be more than one since there are no limits to the number of beneficiaries and in case of such instances ,it is recommended that you designate the percentage of the life insurance proceeds to each individual rather than a specific amount. Changing your life insurance beneficiary Always remember to update the name of your life insurance beneficiary in case of changes in your life such as marriage, divorce, birth of your child or death of a beneficiary. Changing is a simple process if your insurance policy allows for it. Revocable beneficiary policy: can be altered any time by filling the life insurance beneficiary designation form and submitting it to your insurance company who then update your life insurance policy with your request hence the named is also called a temporary life insurance beneficiary. Irrevocable beneficiary policy: cannot be altered without the beneficiarys consent and if he/she refuses to sign the consent form allowing you to alter then nothing can be changed. It is also called a permanent life insurance benefit. Choosing a life insurance beneficiary Choosing a life insurance beneficiary is very important. The following are some beneficiaries that are commonly used; 1. Spouse. The most common beneficiary is the spouse for the fact that youre married. 2. Child (ren) .they can be beneficiaries if they are over 21 years and do not require a trustee. 3. Parents. They are usually named as life insurance beneficiaries for various reasons such as:- You are single with no family or children and want protection for funeral expenses. In case of death of you and your spouse and would want your parents to take care of them. 4. Charity (ies).this usually happens in the case where the beneficiary does not have immediate family. 5. Friends. They can be made beneficiaries if the insured does not have immediate family members. 6. Estate. An estate can be named as a life insurance beneficiary in whom the proceeds are subject to probate fees hence it is advisable to name beneficiaries. In this case the benefits are subject to creditors. Tips when naming a life insurance beneficiary Life insurance proceeds should have a named life insurance beneficiary, since they pass out of probate meaning they are protected from creditors and the named benefits are paid immediately to the life insurance beneficiary. The wording of the beneficiary should be clear and specific to avoid wrangles and unnecessary legal battles, for example you should not name wife as beneficiary but her name. It is also important to anticipate for several situations such as marriage, divorce, birth and death and hence change the information. Choose a beneficiary carefully since the designation of the beneficiary of your life insurance benefits is much more than passing consideration. Dont just accept a suggested format that may accompany a policy application. It is advisable to discuss your objectives and concerns with your professional advisors before you make this important decision on a life insurance beneficiary. About the Author: 相关的主题文章: