Posted: Tue Sep 30, 2008 4:32 am Post subject: Life insurance beneficiary
Hi..is it possible for me to show someone as my life insurance beneficiary if the person is not my relative? What do I need to do in order to change my life insurance beneficiary?
Purpleheaded08 _________________ Register Now to have your Insurance queries solved.
Yes, it is quite natural for an individual to consider his children, spouse, parent or anyone within the blood-relation as his possible life insurance beneficiaries. At the same time he might also suggest other entities e.g. his estate, partner, trust, lender for the same. I don't see any harm in doing so and that's very much legal. If its your investment then its gottabe your decision in the end.
ArindamSenIndies
Hi,
Why don't you check out the state laws?
There are some states which mention that under specific circumstances a non-relative beneficiary may develop an 'insurable interest'. An insurable interest develops when one person grows a financial interest over the insured's life. Thus, the beneficiary must have a cause to go through a financial loss in the event the insured passes away.
Evan
My friend, the tax clauses are sometimes too complex to follow. So, please make sure that you've got the implications in the right sense. The proceeds of your life policy are mostly not subject to taxation but they could be held for other conditions. In case you show your estate as the beneficiary of your life insurance, then it would add more to the size of your estate,undergo probation and develop the estate tax liability. You may call on your accountant or attorney for further clarifications. Thanks, ArindamSenIndies
Hi..is it possible for me to show someone as my life insurance beneficiary if the person is not my relative? What do I need to do in order to change my life insurance beneficiary?
Hi Purpleheaded08,
Yes it is possible to show someone as your life insurance beneficiary if that person is not your relative. When you purchase your life insurance policy you may name anyone you want as beneficiary. In case you want to change your life insurance beneficiary, you simply need to get in touch with your insurance company and see what process they follow. You may be needed to put forth your request in writing, usually on a form provided by your insurer. However, sometimes the process may not be this simple. If you have designated an irreversible beneficiary, you may have to take the permission of your present beneficiary. If your present beneficiary does not allow, you cannot change the name. In case you are getting a divorce and want to change your beneficiary, you must meet the terms mentioned in your divorce order. You never know but your divorce decree might require you to maintain your life insurance policy keeping your ex-wife as beneficiary.
Hey there..whatever be the case, don't ever try to alter the name of the beneficiary through your will. The 'change of beneficiary' option mentioned in your will would not let you change the beneficiary actually. It would never replace the beneficiary designation mentioned in your life insurance policy. Make sure that you follow the procedures set by your insurance carrier for that purpose.
Fatman
What happens if a beneficiary is not mentioned. We recently got a 401K staement in the mail and my husband had me listed as the beneficiary and on this last statement it had said "no beneficiary listed". I am going to get him to call and see what is going on but justnthought I would ask.
I would also suggest that if you purposely exclude someone as beneficiary on an insurance policy - someone who "normally" would be listed - that you also note that in your will/trust/estate documents. Something as simple as "I purposely excluded ________ as a beneficiary to my estate."
This way, when that time comes, _____________ can't jump up and say that you just forgot to include them. _________________ Life moves pretty fast. If you don't stop and look around once in a while, you could miss it. - Ferris Bueller
Call your insurance company and find out what the matter is. Do you have any supporting documents - like a copy of the form you submitted where you have mentioned the name of the beneficiary? If you have it, you might as well keep it handy
In the event, the state laws do not allow a non-relative to be named as beneficiary, the policy owner may assign the policy to the non-relative.
Alternatively, the policyowner may name his estate as beneficiary and write a will to specify that he wants the non-relative to receive the policy proceeds. _________________ I am an insuranc sales coach for almost 2 decades. I have a collection of insurance agents' sales stories. To know more, you can visit http://www.stories-connect.com or http://xoseph.wordpress.com
Hi Sil, My hubby and I got on the website and requested the beneficiary documents be sent to us in the mail so we can add my name. I just think it would save aggravation if anything would happed (pray not.). Thanks for your suggestion, maybe an added phone call wouldn't be a bad idea.
