Life Insurance Beneficiary Rules at Life

Life Insurance Beneficiary Rules. Know the total amount of the death benefit; A beneficiary is a person who is named in this contract as a recipient of the life insurance proceeds in the event of the insured person’s death.

In most cases, beneficiaries are loved ones or family friends, though a beneficiary may also be (for tax purposes) an estate or trust created in your name. This means choosing your beneficiary is an important step in owning a life insurance policy. Life insurance beneficiary rules after a divorce vary by state.

Spending Down Assets to Qualify for Medicaid

Numerous transfers of inherited assets are thus carried out, thanks to life insurance policies. However, the insurers mostly prefer that your beneficiary chosen should be from your immediate family. When a minor is a primary beneficiary, most states utilize the uniform transfer to minors act, which allows the proceeds from a life insurance benefit to transfer to a child’s named custodian. Life insurance is a contract, and like all contracts, it.