Can I Name Anyone I Want as my Beneficiary?
February 1, 2010 |
Beneficiary, Featured
When it comes to choosing the beneficiary for your life insurance policy, you have the ability to name whomever you want. However, there are a few things you should consider before you actually name your beneficiaries on your life insurance policy documents. For one thing, you need to be name specific. Simply stating “my spouse”or “my wife” could put you at risk of an ex-spouse or partner trying to claim benefits after a divorce. Another thing that many insurance professionals advise people to do is name a secondary or contingent beneficiary. This is for situations where you end up out living your primary beneficiary.
You should always name actual family members as your beneficiaries rather than just allowing the proceeds from your life insurance policy to end up in your estate. A major advantage to death benefits on a life insurance policy is usually they get paid out to beneficiaries very quickly. Normally beneficiaries will be paid within 60 days of filing their claim. This avoids having to go through a lengthy probate court process along with your other assets that are part of your estate.
You can change your beneficiaries on your life insurance policy whenever you want to. However if there are important life changes such as divorce or death of your beneficiary, you do need to make sure you actually do remember to change your beneficiary. It’s possible for your survivors to challenge your named beneficiary. However the process is an expensive and lengthy one.
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