A family member or members are the most common type of beneficiary designation. Designating a family member as beneficiary is usually not a problem as long as the person is not a minor.
Example: Jane Doe, spouse – 50%
Fred Doe, son – 50%
Children should not be named as beneficiary unless there is a trustee named to handle the claim transaction. If there is no trustee, the insurance company must determine who has the legal authority to accept payment on behalf of the minor child or children which may delay payment of the proceeds.
Example: Jane and Fred Smith, children, with John Doe as trustee if said children are minors. If you decide to name your children, please include the name, address, social security # and date of birth for each child.
It is always a good idea to name a contingent beneficiary as the primary beneficiary may predecease the insured and if no contingent beneficiary is named, the proceeds would be paid in accordance with the policy provisions.
If a creditor is to be the beneficiary, the form should indicate the amount that is to go to the creditor. Example: XYZ Bank as its interest may appear with the balance payable to Jane Doe, spouse.
If you name a funeral home as the primary beneficiary, please indicate “as their interest appears” and name a contingent beneficiary to receive any proceeds not paid to the funeral home.