Unfortunately this is something that you just can’t do.
Over time circumstances in our lives will change. And whilst the actual amount of insurance cover you have in place may still be correct it is also important to make sure that the ownership of the policy is as it should be.
Ownership of your policy dictates just who will receive the funds when you pass away…If this is not correct then it could be that benefit wont flow to the right person or people.
Life Insurance Policy Structures
One the life insurance quotes are handled, the most common ownership structures for life insurance policies are individual ownership, joint ownership between spouses or trustee ownership on behalf of a family trust. Unless your trust is a limited liability trust then the actual trust cannot own your policy, it must be owned by your trustees on behalf of your trust. In this situation we recommend a trustee resolution confirming these arrangements be prepared, and added to your trust file.
Over the lifetime of a family trust it is common for relationships to change and for trustees to change. It is critical that if a person is no longer a trustee of your trust that the are also removed as an owner of your insurance policy and replaced with the new trustee.
Blended Families & Life Insurance
Another key consideration with ownership, especially in the modern age with blended families is ensuring that children from any previous marriages are provided for as well as any children arising from a new marriage. When marriages break down and families separate it is also extremely important that the ownership of any insurance policies be reviewed. It may be that joint ownership is till appropriate as the surviving ex spouse will be responsible for any children.
If family dynamics are tenuous during in good times, when there is a death and people are grieving it can be extremely difficult – having the correct ownership of your insurance policy is very important as it provides certainty for the future.
It also helps ensure that your wishes are carried out.
The best and easiest way to ensure that your insurance policy is going to provide the outcome that you need if you do pass away is to your insurance policy and ownership structure each year to make sure that it is still correct, this is also a good time to review your estate planning and make any changes that are necessary.
More Than Just Life Insurance Quotes
It’s easy to take the ‘it won’t happen to me’ approach when a little prior planning can make all the difference to your loved ones if the unexpected does happen.
Let us help with these details…Our life insurance quotes service is free and easy to use. If you choose to let us help you with your life insurance matters, then we can provide independent, and easy to understand advice to help with the small but important details.