Who Owns Policy

[scagnt83]

Why is there no law against this crap?

There is.

A legal guardian must sign the insurance contract as your "representative" to consent to them Owning/Purchasing a policy on you.

It is very likely that the original Beneficiary was one of your parents... if she now hates you... she very well could have changed it to herself.

I would offer to buy it from her if I were you.
Or double check with your parents that they did indeed sign the contract back when you were a kid... you never know...

 

[sdgirl72]

I agree that Bill gave the best advice as well. Once you find out what kind of equity she has, then evaluate if it is really worth your time and energy to pursue it. I would let it go if I were you.

 

[WinoBlues]

I get this call once or twice a year from one of my cousins. Every time she gets made at my aunt she wants to cash in the policy we set up when was a little girl. I always suggest she pay her mother for the policy and she can not figure why she should since it is on her life. In my cousins case she would not pay for a policy on herself because it will not be her problem when she dies.

 

[Jerard]

The OP didn't get the answer he wanted so I would be surprised to see any further comments from him.

Nevertheless there is another thought that I had on this: Since he says that he will most likely outlive her (one way or another...) won't the policy ownership revert to the insured after she dies (in the absence of a contingent owner)? He should call the insurance company to make sure who is listed as what. He also shouldn't do anything to reveal to the aunt that he is concerned over this policy or she may transfer her ownership to someone younger just before she croaks. And yes, she can do that. A new owner doesn't have to show insurable interest.

On a personal thought: I can see why his great aunt doesn't like him anymore now that he's grown up.....errr...or rather older.

 

[scagnt83]

Since he says that he will most likely outlive her (one way or another...) won't the policy ownership revert to the insured after she dies (in the absence of a contingent owner)? He should call the insurance company to make sure who is listed as what..

I had that thought as well. But it will most likely just go to the Estate. It is considered legally owned property. Legally, I dont see how they could change ownership to someone who is not listed in the deceased's Estate/Will.

Even though he is the Insured, most States only recognize the Insured as an incidental party to the Transaction, which is between the Insurance Company & the Owner/Payor.

Once she dies, it would probably be much easier to purchase the policy. The Executor of the Estate might jump at the chance.

 

[Jerard]

I had that thought as well. But it will most likely just go to the Estate. It is considered legally owned property. Legally, I dont see how they could change ownership to someone who is not listed in the deceased's Estate/Will.

Even though he is the Insured, most States only recognize the Insured as an incidental party to the Transaction, which is between the Insurance Company & the Owner/Payor.

Once she dies, it would probably be much easier to purchase the policy. The Executor of the Estate might jump at the chance.

Could this be something that would vary from state to state...or even from company to company? I remember calling a company and asking about a situation like this. I think they said that since the owner had died the ownership goes to the insured. This was awhile ago and my memory was the second thing to go. On that particular policy he thought it was paid up but in actuality it had lapsed 20 years before. Good for me....he got another.

 

[LGilmore]

Just have to say that life must be pretty good for the OP if this is the only thing he has to worry about. A relative owns a small policy taken out when you were a child. She may get some money when you die if she's still alive. Is this really something to concern yourself about?

Not to make light of your situation but when you think about people who make you unhappy, they win. I would simply say see ya later Auntie.

 

[scagnt83]

Could this be something that would vary from state to state...or even from company to company?

I have no experience with the situation so I am only guessing. But I would think that it could vary based on state law.


Think about it from a situational perspective though:

Your dad owns a Life Insurance Policy that he paid premiums on for 20 years and it has a CV of $100k.

He dies. You are the sole beneficiary of his will & estate.

Should that $100k ASSET go to someone other than you?

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you dont understand. i dont want her having it on me. period.

It is very likely that she initially took out the policy to do something nice for your parents. Many young parents can not afford a life insurance policy for their kids. And if the worst were to happen, they certainly couldnt afford a $10k-$20k funeral.

Obviously I dont know your situation. But often an aunt or uncle are the ones who assume responsibility of burial if parents are no longer around. So that is most likely why she kept it in her name and never transferred it to them.

No matter what your relationship is like now. The original intent was most likely one of love and concern for your families well being.

 

[QuestionTexas]

My mom took out the Gerber policy on me when I was like 2 and she paid on it until i got old enough to work and I took it over.

She says she doesn't remember authorizing my aunt to take out the policy, but she did authorize my great grandparents to take out one and they turned it over to her... not sure why. I guess the family wants me dead. haha

I told her I would offer to pick up payments on it and she has agreed to turn it over to me. Or so she says...

 

[WinoBlues]

My mom took out the Gerber policy on me when I was like 2 and she paid on it until i got old enough to work and I took it over.

She says she doesn't remember authorizing my aunt to take out the policy, but she did authorize my great grandparents to take out one and they turned it over to her... not sure why. I guess the family wants me dead. haha

I told her I would offer to pick up payments on it and she has agreed to turn it over to me. Or so she says...

Good for her. I would would have cased it out myself. If she just signs it over to you you should thank her for the gift. Stand up thing to do.