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Life insurance can help your loved ones have financial protection should something happen to you. Once your policy is in place, tell your beneficiaries about the protection and make sure everything they will need to claim the policy can be readily located.
Below are four ways you can make sure your beneficiaries have the important information they’ll need:
1. Let your beneficiaries know they’re covered.
Tell your beneficiaries that they’re covered and share pertinent details, including the amount of the policy. Provide them with a copy of your policy. You may want to share scanned copies of the original documents in a clearly titled email for their reference. Keep paper copies in a secure place and tell your beneficiaries where these are kept.
2. Get the details on your beneficiaries to include in your policies and accounts
Provide information about your beneficiaries to your lawyer and financial professional. To help locate your beneficiaries after your passing, you’ll need critical pieces of information: full beneficiary names (double-check that you have the correct spelling), social security numbers, physical addresses, email addresses, and all phone numbers. If you have passport photos or any other information that would help to establish their identity, this could prove helpful.
3. Keep your policies up to date
Review your policies regularly to keep all information accurate and that your beneficiaries are properly listed. Update your policies in the event of a significant life change, such as a divorce or a birth of a child. List specific names for beneficiaries rather than terms such as “spouse” or “child” to help avoid confusion.
4. Create a plan of action for your beneficiaries
Keep all your records organized and in a safe place and make sure that your beneficiaries know where to go for information. As a backup, keep a duplicate set of records in another physical location, such as with your lawyer or at the home of another responsible relative. Include the numbers and keys of any safe-deposit boxes you hold and all pertinent contact information and account numbers. If you use a cloud-based platform to secure your documents or passwords, make sure that your beneficiaries know how to access these.
Most people arrange to have an executor, usually a lawyer, who has been instructed to take care of essential practical matters after you’re gone. These tasks could range from funeral arrangements to securing a death certificate (essential in receiving money from life insurance) to closing out certain personal accounts, such as online profiles. Tell your beneficiaries who your appointed executor will be.
You’ve prepared to financially protect your beneficiaries, so going one step further and keeping updated information readily available to those who may need it will make the process easier. Discuss all your plans with your lawyer, financial professional, beneficiaries, and anyone else who may need the information to ensure your wishes are fulfilled.