Can you be both the owner and beneficary of a life insurance policy?

Question

I'm currently paying for life insurance policy that my father took out on my mother years back. My dad is past away and my mom can't pay for the policy so I'm wondering how I can become the owner or if that is even possible.

I am also the beneficary by the way.

Also.. if I do become the owner of the life insurance, what implications are there other than the fact that I have to pay the premium which I already do. Does this count as an asset to me and removes it as an asset to her?

Answer 1

Yes. Typically, the owner of a policy is the insured, but the owner of the policy can named any insured he/she wants. In this case, your mother would be the insured, you would be the owner of the policy, and coincidentally, you would also be the beneficiary.

I don't understand the asset part of your question because a term-life policy has no worth except in the death of the insured. A whole life policy would have a cash value that could be cashed out now or borrowed against. If you own the policy, you would be the one that could pledge that policy as collateral against a loan. But the only people that would give you a loan against it (in all likelihood) would be the life insurance company itself. Paying back the loan and keeping the premiums up to date becomes pretty spendy.

Answer 2

Yes

Answer 3

The owner in the sense - the life assured is the legal owner of the policy. Here when your father had taken the policy in the name of your mother. So, naturally she is the owner of the policy. She may receive the preceeds from the policy, if there is any.

You can pay the premium of behalf of your mother.

There is an assignment clause by which the ownership of the policy may be transferred to someone on certain conditions. But there are certain restrictions.

Answer 4

Yes, you can.  If your father is the current owner, and your mother is the insured, she'll have to contact the insurance company to get the forms to see how the policy ownership can be transferred to you.

Life insurance is NOT an asset.

Answer 5

yes.