by Insurance Expert » Thu Jul 30, 2009 03:54 am
There have been quite a few posts with this subject.
Many people have been saying that if there is not a named beneficiary, the proceeds get paid to the estate.
I chimed in and said that a policy could have a default beneficiary. I also said that I thought that most policies don't have a default beneficiary.
Anyway, I sold two policies today from two different companies and both of them on the application said what would happen to the money if no beneficiary was alive. In neither case would the money go directly to the estate.
Many people have been saying that if there is not a named beneficiary, the proceeds get paid to the estate.
I chimed in and said that a policy could have a default beneficiary. I also said that I thought that most policies don't have a default beneficiary.
Anyway, I sold two policies today from two different companies and both of them on the application said what would happen to the money if no beneficiary was alive. In neither case would the money go directly to the estate.
Posted: Sun Aug 02, 2009 07:13 pm Post Subject:
Insurance Expert wrote:
Gary, you are asking me to prove a negative. You are the one that is saying that there is a law that says that a blank beneficiary designation must be paid to the estate of the owner.
Click THIS LINKY.
222.13 Life insurance policies; disposition of proceeds.--
(1) Whenever any person residing in the state shall die leaving insurance on his or her life, the said insurance shall inure exclusively to the benefit of the person for whose use and benefit such insurance is designated in the policy, and the proceeds thereof shall be exempt from the claims of creditors of the insured unless the insurance policy or a valid assignment thereof provides otherwise.
Notwithstanding the foregoing, whenever the insurance, by designation or otherwise, is payable to the insured or to the insured's estate or to his or her executors, administrators, or assigns, the insurance proceeds shall become a part of the insured's estate for all purposes and shall be administered by the personal representative of the estate of the insured in accordance with the probate laws of the state in like manner as other assets of the insured's estate.
Posted: Sun Aug 02, 2009 08:15 pm Post Subject:
Gary, I'm disappointed in your reading comprehension. It is unambiguous, but the statute doesn't say what you think that it says.
The first paragraph simply says that if the death benefit goes to a person, that death benefit will be exempt from the creditors of the insured person.
The second paragraph says when the beneficiary is the insured or the insured's estate, it is treated like any other assets and thus, it won't have the same protection from creditors. The reason doesn't matter. ie. It can be a named beneficiary or it can be a default beneficiary.
There is nothing in those paragraphs that says that if a beneficiary isn't named, the money must go to the estate of the owner.
Posted: Sun Aug 02, 2009 08:56 pm Post Subject:
The original Primary Beneficiary on EVERY life insurance policy and EVERY annuity contract written in the United States of America with EVERY life insurance company and that means ALL life insurance companies is designated on the ORIGINAL APPLICATION.
It is stated, but sometimes it is stated by something along the lines of, "if no beneficiary is named or if no beneficiaries are alive at time of death, the beneficiaries will be X, Y, Z."
If ALL beneficiaries PREDECEASE the Owner/Insured or IF there ARE NOT any beneficiaries designated in the policy OR a subsequent Beneficiary Change Form then the proceeds of the policy would be paid to the Owner/Insured’s ESTATE upon the Owner/Insured’s death.
PERIOD.
END OF STORY.
You have thus far completely failed to explain how a policy can be paid to someone’s estate if that person is still alive. You have also failed to show any indication of any law that talks about where the money must be paid if there is no beneficiary designated by the owner. I also can’t find any law addressing this because I think that there is a good chance that there isn’t one. Why would one be needed as long as each insurer has a way to determine the payout in these situations?
I have 20 years in the business. Everything else about me will remain anonymous. It’s not by choice. Because I’m a registered rep, my B/D won’t let me post anything in any other manner. I am licensed in Florida.
I have checked with the insurance company that I originally mentioned to see what they do in Florida in this case. They pay to the owner if the owner is alive. Otherwise, they pay to the owner’s estate. How does this relate to the statute that you posted? It simply means that this money is exempt from creditors when the owner and the insured are not the same person.
Instead of wasting time checking my credentials, find a law that backs you up or an insurance company that agrees with you. I can be the janitor at an elementary school and have never been licensed in my life. That doesn’t change the fact that I’m right about this. Heck, I don’t even think that you can find an agent on this board that is going tell me that I’m wrong on this.
Posted: Thu Aug 06, 2009 12:35 am Post Subject:
I have 20 years in the business. Everything else about me will remain anonymous. It’s not by choice. Because I’m a registered rep, my B/D won’t let me post anything in any other manner. I am licensed in Florida.
What an absolute load of bllsht. :roll:
:P I'm.... ROLLING ON THE FLOOR LAUGHING OUT LOUD! :P
Who's your Broker-Dealer? Bernard Madoff?
Posted: Thu Aug 06, 2009 09:37 am Post Subject:
Gary, I guess that you are one of those people who find it easier to change the subject than to "man up" and admit when they are wrong.
Posting on the internet is considered advertising by FINRA. Registered reps can't advertise without getting prior permission from their B/D. This means that in order for a RR to post, their B/D would need to approve the post in advance. I don't post B.S. I post correct information and when I post something that's wrong, I admit it.
Posted: Thu Aug 06, 2009 10:52 am Post Subject:
Okay, well I'm glad we got that cleared up. :roll:
BackToTheTopic:
At the risk of losing my SAFE designation I'll RESTATE what I've already stated........
I'll say it again and try to use stronger language. When the beneficiary designation is left blank on a life insurance policy or an annuity contract the proceeds are paid to "The Estate" of the *owner of the policy.
E V E R Y T I M E.
Period.
End of story.
Please provide any state law to the contrary because I like to know which state has a distribution method for this situation outside of the Probate Court system.
PLEASE, I'm not asking for your opinion SHOW-ME the state law that supports your claims.
*This presumes the Owner and the Insured are one and the same person. Which is almost ALWAYS, most of the time, the way it’s done.
So called, “Insurance Expert”
PLEASE PROVIDE ANY STATE LAW TO THE CONTRARY.
Posted: Thu Aug 06, 2009 12:15 pm Post Subject:
Gary, if there is no beneficiary and the owner and the insured are the same person, the money will get paid to the owner/insured's estate. I'm not arguing that point.
What I'm arguing is whether a beneficiary has to be specifially named or not. Death without a beneficiary is a very different subject than death without a named beneficiary. If a beneficiary is left blank that does not mean that there is no beneficiary. A life insurance is a contract. An insurance company can't issue a contract in a state that is inconsistent with state law. If a life insurance contract says, "If no beneficiaries are alive, the policy will be paid in the following manner...", it will be paid according to that default manner and it would be no different than writing in the name of those people.
That modifier that you have added is important. It's not a small portion of life insurance that does not have the owner and the beneficiary being the same person. The owner and the insured are usually the same person only if we decide to not include all of the BOLI (Bank owned) policies, all of the COLI (corporate owned) policies, all of the STOLI (stranger owned) policies, all of the policies on wealthy people, all of the policies funding buy-sells, all of the kiddie policies, etc. That is one heck of a lot of policies where the owner and the insured aren't the same.
It is certainly true that a kitchen table sale typically has the husband the owner of the policy on his life. So what?
Again, not only can't I find a state law that is contrary, I can't find state law that supports what you are saying. You are the one saying that things have to be a certain way. You have been given examples from real people showing that you are wrong.
At what point over the last couple of days did this law that you keep mentioning change so that it only applies when the owner and the insured are the same person? What happens when the owner and the insured are not the same person.
The probate court system isn't needed when there is a default beneficiary.
What you basically saying in this conversation is that it's not legal to have a default beneficiary despite all evidence to the contrary and your inability to find a law to back up your point of view and your unwillingness to call an insurance company.
Posted: Thu Aug 06, 2009 12:26 pm Post Subject:
Gary, If I'm understanding this correctly, and admittedly I may not be. I think what the expert is saying is that there are policys that address no beneficary, and how the policy will be distributed if there are none, rather than automatically going to the 'estate'...I've seen these policys myself..most state employee policys (for sure) will state things like this for Orgeon govt. employees,
NO BENEFICIARY
If you do not designate a beneficiary to receive the proceeds of your life insurance or if no designated
beneficiary survives you, your life insurance benefit will be paid in the following order to your:
1. Surviving spouse;
2. Surviving children, divided equally
3. Surviving parents, divided equally
4. Estate
http://oregon.gov/DOC/HR/docs/payroll_news/beneficiaries.doc
It would appear that in the great state of Missouri..The 'estate' is number four in the pecking order...
In the event the last named beneficiary dies before you, or if no beneficiary shall have been named, the life insurance will be paid to your wife or husband, if living; if not living, equally to your surviving children; if none survive, to either your mother or father, or to both equally if both survive; if there are no such survivors, to the executor or administrator of your estate." http://openjurist.org/477/f2d/319/john-hancock-mutual-life-insurance-company-v-jackson-l-p
I have been thru this on a personal level with my brothers death...all the policys stated the distribution list if either no named beneficary, or the beneficary pre-deceased the insured...an no he was not a state or gov't employee...nor did it have to thru probate.
What an absolute load of bllsht
Gary, because you CHOSE to put your personal information out there, in no way makes you any better or worse, or more or less informed than another...Most people (including myself) don't care to allow every nut in the bunch to be able to track me down if they so chose. I don't know about the 'expert', but I do know that the company I work for also doesn't allow me to post using my own name, regarding insurance, without their expressed permission.I can be the janitor at an elementary school
Hey, my sister is, they prefer, ''engineer'' :lol: :wink:Posted: Thu Aug 06, 2009 03:14 pm Post Subject:
I have 20 years in the business. Everything else about me will remain anonymous. It’s not by choice. Because I’m a registered rep, my B/D won’t let me post anything in any other manner. I am licensed in Florida.
Our b/d feels the same way. The told us no blogs, forums, IMs, social networking, ....
Even if we post strictly in the role of an insurance agent, they aren't happy with it.
Posted: Sat Aug 08, 2009 02:02 pm Post Subject:
Lori, et al...
I don't care how they do it in any "other" state than Florida.
In Florida...the ONLY jurisdiction I care about...if there isn't a named beneficiary designation those proceeds WILL be paid to the Estate of the Owner/Insured if they are one and the same person on LIFE INSURANCE.
Annuity contracts are another story....most are ANNUITANT driven, if the Owner and the Annuitant ARE NOT one and the same person and the ANNUITANT dies the proceeds are paid to the named beneficiaries. The Owner may or may not be one of the beneficiaries.
The insurance company determines whether the policy is ANNUITANT driven or Owner driven.
RE: The stock broker "registered representatives" and THEIR Broker-Dealers.
I have ZERO respect for ANONYMOUS posters on the Internet. They spread disinformation and hide behind their screen names.
This thread is an example of a waste of bandwidth as so-called Insurance Expert is making a pointless point that doesn't apply to most all life insurance contracts written.
Of course, that's why I hold the only SAFE designation in the United States of America!
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