When you become a parent there’s instantly a looooong list of responsibilities that you are suddenly faced with. While that is the understatement of the year, there are numerous aspects pertaining you have to become prepared to deal with such as life insurance and adding a life insurance beneficiary to your plan. Read on to learn more:
What is a Life Insurance Beneficiary?
When you purchase a life insurance policy, the beneficiary is someone who received the benefit when the life insurance policy holder passes. Typically an easy process, life insurance beneficiaries are generally family members, children, friends, or spouses. You can also make an estate, business or a charity a beneficiary.
Other interesting facts about a life insurance beneficiary to consider:
- Multiple people can be a beneficiary.
- Splitting the insurance benefit falls into two categories: Per stirpes or Per capita.
- To be added as an beneficiary, you’ll need the consent from the holder. An insurance holder will need a full name, phone number, social security number, date of birth as well as their consent.
- Beneficiaries can be either primary beneficiaries and contingent beneficiaries.
- The main, or primary beneficiary will not receive any insurance benefits if they pass away before name insured.
- Contingent beneficiaries only receive benefits if a primary passes.
- Life insurance benefits are typically received after the insurance company receives a death certificate, a policy document and a life insurance claim form.
- It is important to keep your life insurance beneficiaries updated, such as in the case of divorce or changes in the family dynamic.
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