You may take out a life insurance policy for any number of reasons, such as a 30-year term policy large enough to cover the amount of your house mortgage or a whole life policy with the intention of cash accumulation to be used in your golden years. If you have a family and have taken out a Greensboro life insurance policy in order to help provide for them in the event of your premature death, it’s important that they know you have this coverage.
You want things to go as easily as possible for your wife/husband, who will likely be your named beneficiary, and the lump sum payoff can go a long way toward easing the strain that goes with a death in the family. But if your family doesn’t know a policy exists or knows there’s a policy but can’t locate the necessary documents, they won’t be able to get the claim going. Here’s what your beneficiaries need to know.
Nominated Beneficiaries
Beneficiaries to your Greensboro life insurance policy need to know you have a policy and that they are named as beneficiaries. They need to know where the policy is stored and the policy details and exclusions. Since it may take some time for the insurance claim to be settled and money may be needed immediately to help pay funeral and burial costs, your beneficiaries should know if your policy includes a funeral advance benefit. This allows for a certain amount of money to be paid in advance of the actual death benefit payout, to be used to defray funeral and burial costs.
Some policies have exclusions, spelled out in the policy schedule, whereby certain circumstances of death may not be covered. Some, for example, may not cover death by suicide or self-inflicted
injury if it occurs within a specific time of the policy start date. This information is best shared with your beneficiary so there is no false expectation if the insurance claim will be denied.
Debts and Liabilities
It’s probably best to tell your beneficiary of any outstanding debts/liabilities that should be paid off once the insurance claim money is received. You may also want them to know what you would like them to spend the money on. This will require some specific communication. If you’re uncomfortable with this process, it may be necessary to write it down, titled, “in the event of my death.”