Life Insurance Beneficiary

[WinoBlues]

Re: Life Insurrance Beneficiary

Its rare but yes.

If it is a permanent policy with a gain in the CV. Then the owner surrenders the policy. It is a taxable gain.

Life Insurance is only tax-deferred if it is in force.
Outstanding Loans are also taxable if surrendered.

It was most likely a Joint Property State, so legally they were both Owners of the policy even if she was the only owner on paper.

I did not think about that when he posted it, based on the first couple post he made I thought he was confused. I know I was.

 

[michael2020]

Re: Life Insurrance Beneficiary

Hahaha! Yeah... I'm confused myself. I gave you guys as much as I can without going to personal on his life. But that's what he fears. And just going behind his back without him knowing anything of this really got to him. As for the rider beneficiary, I believe that's what he is under as. And one of his Co workers said this whole policy is fraud. That got him to talk to me. I wasn't aware of anything myself. To each his own until it's shared, he is a good man honestly. Pays his workers well. Takes care of his kids. His flaw is on himself and his wife. Both are different.

 

[scagnt83]

Re: Life Insurrance Beneficiary

Stuff like this is part of why some companies have a f2f requirement.

Lol. Of course we have to have an example right after that discussion!

In all fairness, how many times has a person forgot about a policy they are an owner or bene on?

The answer is LOTS!

If I were betting on it, I would put my money on the fact that he forgot about "that form his wife wanted him to sign years ago".

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Hahaha! Yeah... I'm confused myself. I gave you guys as much as I can without going to personal on his life. But that's what he fears. And just going behind his back without him knowing anything of this really got to him. As for the rider beneficiary, I believe that's what he is under as.

From what you have said the only suspect/shady thing is that he was not aware of it. However, people forget about insurance discussions all of the time. Especially when its the other spouse who is taking care of it.

Out of curiosity would he have been against the policy when she took it out had she told him? (if she didnt)

If he would have been opposed to it, then she might have done it anyways as protection.


But at the end of the day what she set up is extremely common and something that is done out of love.

Basically, the main policy is on her. So if she dies, he gets a lump sum.
Then, she has the Rider (secondary policy attached to the main one) on him, so that if he dies she gets a lump sum.

Very normal. Very standard. Very intelligent thing for a loving spouse to do.

 

[VolAgent]

Re: Life Insurrance Beneficiary

Lol. Of course we have to have an example right after that discussion!

In all fairness, how many times has a person forgot about a policy they are an owner or bene on?

The answer is LOTS!

If I were betting on it, I would put my money on the fact that he forgot about "that form his wife wanted him to sign years ago".

If I were a betting man, I'd bet there is more to this story.

The OP is so confused on terminology, it is hard to understand.

I really doubt there is any fraud here. But you know HO employees. Always scared of fraud.

 

[WinoBlues]

Re: Life Insurrance Beneficiary

If I were a betting man, I'd bet there is more to this story.

The OP is so confused on terminology, it is hard to understand.

I really doubt there is any fraud here. But you know HO employees. Always scared of fraud.

Hypothetically.

................

 

[michael2020]

Re: Life Insurrance Beneficiary

Lol. Of course we have to have an example right after that discussion!

In all fairness, how many times has a person forgot about a policy they are an owner or bene on?

The answer is LOTS!

If I were betting on it, I would put my money on the fact that he forgot about "that form his wife wanted him to sign years ago".

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From what you have said the only suspect/shady thing is that he was not aware of it. However, people forget about insurance discussions all of the time. Especially when its the other spouse who is taking care of it.

Out of curiosity would he have been against the policy when she took it out had she told him? (if she didnt)

If he would have been opposed to it, then she might have done it anyways as protection.


But at the end of the day what she set up is extremely common and something that is done out of love.

Basically, the main policy is on her. So if she dies, he gets a lump sum.
Then, she has the Rider (secondary policy attached to the main one) on him, so that if he dies she gets a lump sum.

Very normal. Very standard. Very intelligent thing for a loving spouse to do.

Sorry for my lack of terminology. This is not my thing. I'm just trying to get answers for him. From what I know, he would have opposed any life insurance due to the rocky marriage. He said they spike about it about years ago and he was against it since they both didn't feel comfortable in how long the marriage would last. Now he found out it was done anyways. But I'll talk to him this afternoon.

 

[scagnt83]

Re: Life Insurrance Beneficiary

Sorry for my lack of terminology. This is not my thing. I'm just trying to get answers for him. From what I know, he would have opposed any life insurance due to the rocky marriage. He said they spike about it about years ago and he was against it since they both didn't feel comfortable in how long the marriage would last. Now he found out it was done anyways. But I'll talk to him this afternoon.

The absolute stupidity of his reasoning aside for a moment... (you said they have kids right?)

Would alimony be awarded to her if they divorce? Child support?

If so, then the court will likely order him to have life insurance coverage with the ex-wife as the Beneficiary.

Their reason for this is that if he is gone, how will that financial need be fulfilled?

 

[michael2020]

Re: Life Insurrance Beneficiary

Yup. I know. I think it should be kept. How much does this Cost a month btw? On his paper work, it shows that payments of 150$ a month are being made. Is that high?

 

[Norwayguy]

Sorry for my lack of terminology. This is not my thing. I'm just trying to get answers for him. From what I know, he would have opposed any life insurance due to the rocky marriage. He said they spike about it about years ago and he was against it since they both didn't feel comfortable in how long the marriage would last. Now he found out it was done anyways. But I'll talk to him this afternoon.

So he wanted no protection if instead of divorcing or even on divorcing she died and he had to raise the kids on his own.

 

[LGilmore]

Re: Life Insurrance Beneficiary

OP, excuse me what state are you in?

There is something fishy about this entire thing, I'd say.