Here’s what to consider when naming a life insurance beneficiary.
When you begin the process of securing life insurance, one of the things you will have to do is decide who you will name as a beneficiary on your policy. While this may seem like an easy decision, it requires a little more thought than you might imagine. Here are some things to consider when deciding who your beneficiaries will be.
Who/What Do You Want to Provide For?
While you obviously want to provide for your spouse and children, you also need to consider the other people and entities you want to take care of. For instance, you might want to make provision for your parents, siblings, or other loved ones. Additionally, if you are a business owner or dedicated to a specific nonprofit organization, you can also put aside some of your death benefit for these entities.
What Are Your State’s Guidelines?
Depending on the state that you live in, there might be some rules regarding who you can actually name as your beneficiary. For instance, Texas is a community property state, meaning your spouse will be able to claim your benefit regardless of who is officially named on your policy. State laws such as this one might affect who you decide to list on your policy, so make sure you understand your state’s rules before choosing your beneficiaries.
What Happens If You Want to Name a Minor?
If you want to name a minor as your beneficiary, make sure that you also specify this in your will. This way, if your life insurance benefit is contested in court, the judge can refer to your will and make sure that the payout goes where you wanted. Taking this extra step is one of the best ways to protect your minor’s rights.
These are some of the things you should consider before choosing who to name as your life insurance beneficiary. Do you need further assistance with your life insurance? If so, contact the experts at Pierce Insurance Group. We are ready to get you the coverage that you need today.