All About Life Insurance Beneficiaries

All About Life Insurance Beneficiaries

There are several types and classes of  life insurance beneficiaries and I’m going to do my best to explain each clearly and in an understandable way. There are three main types that you should understand as this is a very important part of your insurance contract.

Primary beneficiaries have the first claim to the proceeds of the life policy following the death of the insured. The owner of the policy (policyowner) may specify more than one primary beneficiary and how the proceeds are divided between each. There is no limit to the number of people that can be listed so if you have 5 children, list them all and tell the insurance company exactly how you want the money divided.

Secondary beneficiaries which are commonly know as, contingent beneficiaries have the second claim IF the primary dies BEFORE the person that is insured does. Contingent beneficiaries do not receive any proceeds from the death of the insured if the primary is still living. Many people make the mistake of listing a secondary beneficiary assuming that the money will be divided between the primary and secondary. This is obviously incorrect.

Tertiary beneficiaries, less commonly known are third in line and receive proceeds if the primary and secondary have predeceased the insured.

If none of the beneficiaries are still living at the time of the insured’s death or if no beneficiary was specified in the policy,  the proceeds will be paid to the insured’s estate (liabilities and assets left by the insured), automatically.

Beneficiary designations can be either revocable or irrevocable. The owner of the policy may change a revocable beneficiary without the beneficiary’s consent. An irrevocable beneficiary is one that once listed in the policy, cannot be changed without the beneficiary’s consent.

Per Capita and Per Stirpes are class designations used to cite a particular grouping to be beneficiary. This is commonly referred to as “all my children”.  When applying for life insurance it’s very important to specifically specify exactly how you want the proceeds of the policy to be divided to prevent any conflict that may arise after your death and to be sure that your final wishes are executed as desired.

Per Capita, which means “by the head”, distributes the proceeds evenly amond living named persons in the policy. Per Stirpes, with means “by the bloodline”, distributes benefits of a beneficiary that died before the insured’s heirs.

Policyowners can change beneficiaries at will unless a person has been listed as being irrevocable.

There are many types of insurance policies to choose from and it’s always best to make sure that you know what you’re getting into. Comparing the details of policies from different companies, side by side, is the best way to make certain that you are getting the fair end of the bargain and that your beneficiaries can be listed without restriction.

http://www.lifeinsurance4all.com is a free tool that you can use to instantly compare life insurance quotes from the nation’s top insurers.

Christy Love is a retired life insurance agent with over 30 years of experience in helping people protect what matters most… their families. As an Ezinearticles.com expert author, Christy enjoys sharing her knowledge of life insurance with the online community.

Article Source: http://EzineArticles.com/?expert=Christy_Love

Picking a life insurance beneficiary is dependent on where you want the money from a life insurance policy to go after your death. Divide life insurance benefits among several people or designate a company or charity to receive the money withtips from an insurance agent in this free video on insurance. Expert: Vic Schumacher Contact: www.HPEFinancialServices.com Bio: Vic Schumacher is part of HPE Financial Services, a brokerage insurance company representing all major carriers. Filmmaker: Christopher Rokosz
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What Joint Term Life Insurance Is All About

What Joint Term Life Insurance Is All About

There are so much terms, phrases and policies in the life insurance market and it is very common to find yourself getting confused especially when you are not very familiar with it. Anyway, as you learn, you will notice there are various types such as whole life and term insurance.

However, under the two categories, there are more specific variants such as joint term life insurance. Basically, there are no much different compare to standard term life insurance which covers a single individual but joint policy covers more than one person. Usually, married couples or someone you are sharing monetary commitment with, you can consider to be insured under a joint plan. As a result, both husband and wife are protected as well as the children in the event of death. You need to assess your situation and your needs before consider to purchase a joint term life insurance policy.

Some referred joint policy as joint first-to-die term life insurance where the policy benefits is only paid out once. This means there is only one payout to the surviving partner when the first of the two joint policy holders dies. A joint policy might not be suitable for you even if you are married. However, it is a sensible consideration if you have kids, you are home owners or retired to ensure that you provide enough protection for your children, to pay off the mortgage and have a comfortable retirement life.

Most married couples would consider to purchases a joint policy under the following situation:

New homeowners – The most popular benefits if joint term life cover is mortgage protection. A joint life insurance policy ensures that the surviving spouse will be able to pay for mortgages and other related debts.

New parents – Joint term life insurance covers the expenses of childcare and tuition fees if your spouse passed away before your children are grown.

Retirees – Joint term life can be used to plan retirement as it allows purchasing an annuity with more choices. Usually, annuity is purchase with options that provides monthly payments until the first partner dies (a single life annuity), or until the remaining partner dies (a last-to-die annuity). The first option offers higher monthly payments without jeopardizing the income for the surviving partner. The reason is because the policy will be paid out to the surviving partner when the first partner dies. If you choose the second options, it will provide the remaining partner a regular monthly income which consider lower than those offered through a single life annuity.

Once you make your decision to purchase joint term life insurance for you and your family, you will need to consider the duration of your policy. Normally, people will choose to cover for 10 or 20 years. If you have young children and just bought a new home, 10 year term is usually sufficient. Couples with older children, have their mortgage paid off or near to retirement can consider longer term. Want to Know More?

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