Four things to remember when choosing a beneficiary
Written on the 15 March 2018 by Arrow
Choosing a beneficiary is usually a simple task, but there are a few things you should keep in mind when you decide.
A beneficiary is the person who will receive your life insurance payment should you pass away. When choosing yours, it's important to think about who would be most financially vulnerable without you in their life. For most people, this is their spouse or children.
If you're yet to nominate your beneficiary for your Life Insurance, you can easily do so. Nominating a beneficiary may seem straightforward, but there are a number of things to be aware of and plan for.
1. If you don't have a beneficiary
If you have outstanding debts when you pass away, your benefit may be used to pay them before it is distributed to the people named in your will this means your loved ones could miss out on the payment.
2. Naming a beneficiary
It's important to consider that if your beneficiary has any debts the proceeds might be used to pay them off. As well as this, keep in mind that if you nominate your children, they will only receive the full amount once they turn 18.
3. Having multiple beneficiaries
If you do decide to choose several people, it's useful to designate a percentage of the payment to each person, as opposed to a specific amount (as this may change).
You should also consider having a contingency beneficiary, should a primary beneficiary pass away before or around the time of your passing (for example, in an accident).
4. Keeping your beneficiary up to date
Remember, you can easily update your policy and beneficiary. And if you have any further questions concerning beneficiaries, feel free to contact us.