You’ve decided to get life insurance. After all, you have a family to provide for now and in the unfortunate event of your passing you want to make sure that you help protect their financial future. You would do anything for your children, which is why you’re considering making them the beneficiaries of your life insurance policy. Before doing so, you may want to consider the following information to better understand the process of paying out to a minor.
What is a Beneficiary?
Before considering anything, you must know what a beneficiary is. A beneficiary is the person you dictate to receive the payout of your life insurance policy if you die.1 Typically, these are the people you want to be financially safe and provide for even when you’re gone. You may run into some issues when designating a minor as your beneficiary due to the age restrictions in place.
Age Restrictions for Life Insurance Beneficiaries
The designation of who is and who is not a minor for purposes of receiving these kinds of benefits is determined at the state level. Generally, the two ages used as the cutoff are 18 and 21.1 Generally, a minor is unable to do anything with insurance benefits until they become of age. To determine what the legal age of majority is to receive benefits in your state please seek legal advice.
You are able to name your child or children as beneficiaries for your life insurance policy. However, you may want to consider if this would make the most sense for your situation. Contact a licensed life insurance agent for more assistance with your life insurance needs and knowledge.
The Nest, Does Life Insurance Pay Out to Minors?, 2019
Categories: Insurance, Life Insurance