Question about life insurance.?

Question

OK so my mom has a life insurance policy of $250,000 and my stepdad one of $20, 000. I am the beneficiary of both of them.

So, my mom is 38 years old right now. Say, when she is 60 years old, she dies (and my stepdad is already dead).

How much will the insurance agents take out for interest, or whatever it may be?

I will have to take over her bills and everything when she dies right?

Im NOT looking for the money, and NO i dont have any plans on killing her.

I just dont have the HEART to talk to my mother about her dying and me getting a quarter of a million dollars out of it!

So please dont take this question the wrong way!!

Answer 1

Insurance agents should never "take-out" anything from a benefit check that belongs to you...ever!  The carrier must send you, the named primary beneficiary, the "face amount" of the policy - in this case it is $250K for your mother's passing.  I agree with one of the previous responders in that one's estate has nothing to do with payable benefits from an insurance policy.  However, estate tax and liability rules should be looked at closely, and a will should be carefully planned.  Your CPA and/or tax attorney can help your family put everything togther.

Answer 2

Life insurance is completely separate from a person's estate.  When someone dies, the life insurance company pays the insurance benefits to the named benificiary(ies) - period.  It has nothing to do with a will and does not go through the estate probate process.  Nothing is taken out for "interest" and it is not taxable income.

The deceased person's ESTATE is responsible for paying off any debts.  Debts are not "inherited" unless you are a coborrower or cosigner for them.  What every adult needs to do is have a current will/estate plan in place so that if they die, the estate will be inherited by the people they desire.  Without a will, the estate is passed on according to state probate law.

Answer 3

Some policies have options to the potential policyholder that loved ones will be taken care of after death. Consider what loss of income would mean to spouse and dependents after death. To ensure that loved ones are taken care of use wisdom in seeking the right policy. For more details checkout  AmericanVistas dot com website