Choosing your beneficiary
Know your options.
Although it might seem like a straightforward task, naming your beneficiary might take some additional thought.
It is important to know everything about your insurance policy and beneficiaries so you can develop the best strategy.
Reach out to one of our agents to help find the best strategy.
In most cases, you’re going to want to choose your spouse or significant other as your beneficiary.
This will help them pay bills, pay down debt and care for minor children.
In some states, if you don’t choose your spouse as beneficiary, they will be required to sign a document acknowledging the situation.
If you’re looking to name your children as beneficiary, age is an important factor to consider.
If the children are still young, consider designating a guardian you’re confident will act according to your wishes.
In this situation, you won’t name the guardian as the beneficiary. You’ll name your children directly.
Don’t worry, your agent will walk you through this during your call.
Often, people wish to leave their insurance proceeds to a charity.
Sometime, this is done when their families are already financially secure and they don’t require any additional support.
This generally requires much consideration and planning ahead of time.
Choosing a Trust as your beneficiary is quite common as well.
This is generally done when you wish to distribute the proceeds of the insurance with certain contingencies or timelines.
In this situation, you want to name the Trust as beneficiary directly.
The Trust will need to be set up prior to naming it as beneficiary.
You’ll have the ability to change beneficiaries any time during the life of your policy.
Adding A "Backup"
Having a secondary (contingency) beneficiary is essential in case something happens to your first or primary choice.
A contingent beneficiary would be used in the case that your primary predeceases you, as the insured.
Without a backup, your insurance would go to your estate, and the courts would decide where the proceeds end up. Notably, it’s essential to use the same criteria for picking the second choice as your first. ‘
Reviewing Your Beneficiaries
It’s good practice to review your beneficiaries periodically.
When you have a life change, such as having a child or a divorce. It may create a need to make a change to your beneficiaries.