by carolyn deel » Mon Aug 25, 2008 10:55 pm
in florida.. step father in law ..passed
away. he was widowed. he left a small
life insurance thru his work. been retired.
left no beneficiary on policy. who sends
death certificate. and who would be entitled by law to the small life insurance policy
away. he was widowed. he left a small
life insurance thru his work. been retired.
left no beneficiary on policy. who sends
death certificate. and who would be entitled by law to the small life insurance policy
Posted: Sat Aug 30, 2008 12:49 am Post Subject:
InsTeacher is exactly correct.
Life insurance proceeds are paid to the deceased person's Estate when there isn't a named beneficiary or if all the beneficiaries pre-deceased the insured. Those proceeds are then treated just like any other probate asset.
This is the worst disposition of life insurance benefits.
Posted: Fri Sep 05, 2008 11:57 pm Post Subject:
This is the worst disposition of life insurance benefits
:(Whenever the death benefit is paid to the estate of the insured, the dollar value of the death benefit will typically increase the cost of probate, and if the estate is large enough, will also increase the estate tax liability of the deceased. Now, there's a lot more to this, and would take a 30-paragraph post to address most of the issued.
Life insurance enjoys many beneficial tax benefits that are not normally available in other financial scenarios. You need to make sure that the life insurance death benefit passes to the beneficiary OUTSIDE of the estate. Do not let the estate be the beneficiary! In just about every instance the death benefit passes to the beneficiary 100% tax-free. The exceptions to this rule are (1) if the estate is the beneficiary, and (2) if the policy has violated certain Internal Revenue Code rules (can, but rarely does happen).
I just about fall over when people tell me they have purposely named their estate as the beneficiary.
"Were you born this stupid, or did you have to work hard to get there?"
InsTeacher 8)
Posted: Wed Sep 10, 2008 04:15 pm Post Subject:
Goes to the estate....it will be decided in probate where the death benefit will go.
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Posted: Wed Sep 10, 2008 10:53 pm Post Subject:
I just about fall over when people tell me they have purposely named their estate as the beneficiary.
"Were you born this stupid, or did you have to work hard to get there?"
InsTeacher I describe that as Apathetic Ignorance.
Apathetic means: not interested or concerned; indifferent or unresponsive.
Ignorance means: lack of knowledge, learning or information.
No clear thinking person would ever name the "Estate" as beneficary on a life insurance policy if they actually understood what they were doing.
The only "professionals" I know who routinely recommend that are probate practice attorneys.
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