Once you understand what a beneficiary is, then you'll decide who you want that to be.
When buying a life insurance policy, you are doing it because the policy's death benefit will provide financial support to your loved ones and why you choose a beneficiary. Once you understand what a beneficiary is, then you'll decide who you want that to be.
A beneficiary is the person or entity who will receive the death benefits of your life insurance policy after you die. For example, if your term policy includes a $300,000 death benefit, your beneficiary will receive $300,000, if you die before your policy matures. If you don't make the choice, your estate will make it for you.
Whom can you choose as a Beneficiary?
You have options on who can be your beneficiary. Some choices are spouses, child or other relatives, a trustee, entity, friends or caregivers. Also, more than one person can receive your death benefits.
A trustee oversees your estate and ensures the death benefits are handled appropriately.
An entity is your favorite charity, college or cause can be the recipient of your life insurance death benefit.
Specify the Beneficiaries
When choosing a beneficiary, be as specific, clear and include as much detail as possible to help the process go smoothly. Include the person's full name and social security number to prevent conflict over who receives what. For example, if your beneficiary list includes "wife" but you get a divorce and remarried after your policy is issued, both your current and former wives can claim the insurance policy at the time of your death.
Your life insurance policy is a wise investment. Understand beneficiaries and update your policy often to ensure your wishes are met. Tracy-Driscoll would love to help you check and review life insurance policy. Give us a call at 860-589-3434 to speak with one of our insurance professionals.