Estate Plan – Life Insurance & Probate

Estate Plan – Life Insurance & Probate

While discussing about the Estate Plan, life Insurance plays a vital role. Life insurance is considered as the quick source of cash to the beneficiary in the event of untoward incident to the Policy holders. Life insurance policies play a crucial role in filling up the financial gaps. Life insurance proceeds can be held in probate if not both major and dependent beneficiaries are listed appropriately.

The administrator of the estate will look at all of the deceased‘s insurance and pension policies. While dealing with the Insurance policies that are paid out on the deceased‘s death an application is logged for payment of the amount concerned. The authority to pension payments may be shifted to the spouse in existence or partner or they may end on death. Proof of the appointed executor should be produced to banks, building societies and other institutions to deal with the deceased‘s affairs.

This proof is called Grant of Probate. The life insurance policy comes under the irrevocable life insurance trust if the deceased has opted for it. Unlike the normal insurance methods, here the owner of the policy holds the full control over the distribution to the beneficiary. Either full distribution or the scheduled distribution can be arranged upon the death of the owner.

Though this method is a useful tool among the Chicago insurance and probate process to plan one’s accumulation of wealth, it is very important to consider the entire scenario before establishing the insurance trust as no changes are permitted after the establishment. An administrator should be appointed by the policy holder along with the beneficiary to help the smooth flow of the insurance proceedings.