What Happens to Life Insurance Proceeds Without a Designated Beneficiary?
When your loved one passes away without designating a beneficiary for their life insurance policy or the beneficiaries preceded them in death, what happens now?
If the decedent had not completed a designated beneficiary form for their life insurance policy prior to their passing then it is possible that the life insurance money will go directly into the decedent's estate and will need to be probated. This will then make the insurance proceeds estate assets and subject to being used to payoff the decedent's creditors. However, it is also possible that the proceeds could pass directly to their heirs at law according to the policy terms, and avoid the probate process.
These same events can occur if the designated beneficiaries proceed the decedent in death.
The best way to avoid the hassle of these scenarios is to have a solid estate plan with all of the necessary estate planning documents secured. A professional Estate Planning Lawyer will give you the freedom to make the choices you want that are best for your surviving loved ones.
*This blog entry was not written by an Attorney and should not be constituted as professional legal advice.