This is about life insurance?

Question

What happens when you turn your life insurance over to the funeral home?

Answer 1

Never, under any circumstances, leave or sign the benifits to a funeral home.

Benifit payout is for the beneficiary's discretion on how the money is dispersed for funeral expenses, bills, etc.

The sole purpose of having a life policy is to make sure the loved ones you leave behind are financially taken care of in the event of you passing.

Some policies (depending on what company and salesman you are dealing with) have monies to cover the funeral expenses in them anyways....so never turn your life insurance over to the funeral home.

It'll also help to have a beneficiary thats responsible. Don't give money to the state. They have enough of it.

Answer 2

You only want to assign an existing life insurance policy to a funeral home if you are applying for Medicaid within the next 30-days.

If you want to lock your costs in on a funeral you buy a funeral policy FROM the funeral home and get a guarantee against inflation of the funeral price.

If you want to use existing insurance...DO NOT assign it to the funeral home unless you are applying for Medicaid. If you do you are just giving up policy ownership rights and you are not getting any additional benefits or guarantees in return.

Most funeral homes will gladly accept it but it is not a good move for you.

Answer 3

they spend every penny of it that they can, and leave next to nothing for any remaining kin, if you had a $10,000 policy they would give you a $9750 funeral....

Answer 4

Clearly the first two answerers haven't a clue what they are talking about.  This is almost always a good idea, and a beneficial one at that for two reasons, one being that the policy is now protected from the state should you ever need to go on assistance or into a nursing home, and two, because you can rest assured that your funeral will be taken care of.

Now, for the most important part that the two above clearly didn't consider.  When you make the funeral home the beneficiary, ALL OF THE EXCESS IS REFUNDED TO THE FAMILY, WE ARE NOT ALLOWED TO KEEP ANY MORE THAN THE COST OF THE FUNERAL!!!!  It is illegal for us to keep the excess.  At the time of the death, the prices will be based on current day price, and all your family needs to do is compare the general price list from the funeral home to the final bill to be sure it is accurate.  Also, the funeral home does not have ANY access to the monies without a death certificate, therefore there is no possible way to spend it, as the first answer incorrectly suggested.

I highly recommend assigning policies, it is a very safe and feasible option that will give you peace of mind.

Answer 5

Generally: You get screwed.

This is never, ever, ever, ever a good idea.  The best thing to do is collect your life insurance policy and pay the funeral home they're bill.  Turning the Life Insurance policy over to them is like giving them the whole check.  And depending on how you do it, they may not be obligated to give you much back for it.  Say you have a $100,000 life policy and you sign the funeral home as an unconditional beneficiary...they can take that money as a donation when you die.

Of course, there are safe ways to do it, but talk to your life insurance agent on those options... and if the agent is worth their weight in salt, they will advise against it.