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Can I Designate My Estate as the #Beneficiary of a #LifeInsurance Policy?

Attorney Thomas B. Burton answers a writer's question from Oshkosh, Wisconsin about whether you can designate your Estate as the #beneficiary of a #lifeinsurance policy.

Transcript of Video: Can I Designate My Estate as Beneficiary of a Life Insurance Policy?

Today's question comes from Oshkosh

Wisconsin and the writer asks the

following can I designate "my

estate" as the beneficiary on a

life insurance policy I am making an

online will and would like clarification

okay so first of all great question and

I salute you for putting your will

together during this time the answer is

yes you can name your estate as the

beneficiary of your life insurance

policy but the question I would ask you

if I was working with you is do you

really want to do that because remember

if you make your estate the beneficiary

of your life insurance policy that means

those funds will flow through your

probate estate and be subject to probate

court fees so let's say you have a

$500,000 life insurance policy your

probate estate would increase by

$500,000 in the fees assessed and that

amount would also increase so you may

want to do this or you may not I can

think of a scenario where you might want

it to flow through your probate estate

and that would be if you have minor

children and you want the life insurance

to fund a testamentary trust for those

minor children created in your will then

you're going to have to have a probate for

the will to set up this trust because

this would be a trust created under a

will and you mentioned doing a will here

and then you would want the money to

flow into that trust upon your death one

other way though you could create a

testamentary trust and name it directly

on the life insurance policy designation

you could say to the testamentary trust

created under my will dated and put in

the date you signed and created your

will so I guess if you were my client I

would want to ask you what's your

ultimate goal here are you trying to get

the money to minors

or are you looking to get it to the

heirs as quickly as possible and without

going to the probate court because in

that instance if they're adults I would

recommend you name them directly on the

life insurance policy if for instance

let's say it's two adult children then

the insurance company would just send

them the check when they provide the

death certificate and the proper form and

it wouldn't have to go through the

probate court so it depends on your mix

of assets and what you're trying to

accomplish here I see you're doing the

will online and again I salute you for

getting this done but I would suggest

that if you work with an attorney one of

the benefits you get is the ability to

have this back and forth and ask

questions and then when I work with my

client I try to help them design the

plan that's best suited for their

specific situation and I try to ask what

is it you're trying to accomplish and

then we find a way to do that in the

most cost-effective manner so great

question thank you for asking and we'll

see you next time!

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Transcript and captions provided for ease of access for the hearing impaired.

For questions about this topic, or to suggest a topic for a future blog post, please contact the office.

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