I am POA for my father who is 95 and lives in a VA home. I was looking over the beneficiaries listed and am confused on how myself and my 2 siblings should be listed. Right now is has all 3 but as the oldest I am shown as receiving 100% of the policy(primary). If I am deceased my brother receives 100%(secondary) and if he is deceased my sister receives 100%. Should this be set up a different way? It would be used mostly for his burial expenses and anything else needed for the funeral. It can be changed at any time so would it be wise to have all 3 children as primary beneficiary? Policy says you can do that. Just want to know the best way to list it to avoid any problems later on. Thanks
If this works for you, talk to the funeral home and her insurance company. Funeral expenses go up every year. Some people make the funeral home full beneficiary and that helps to become Medicaid eligible. My mother's lawyer said that it was fine. Making plans now will ease your mind.
Saturn, just occurred to me - what kind of policy is this? Is it by any change a VA policy? If so, it matures at a certain age.
I don't recall what it was for my father, but it matured and the proceeds were disbursed to him even though I asked in writing that the policy be held and not disbursed, which as I recall was an option, but was ignored by the VA.
There's some provision about maturation of VA policies - I don't remember the issues as to whether it was at a certain age or after so many years of the policy being in force.
If your doing probate, the probate atty will likely know how to set up a special needs trust for a disabled heir if need be so that a heirs medicaid status isnt jeapordized. Or will know who to refer you to for an SNT.
So do you really need to change anything?
You can establish a Will that will direct the payments to go evenly between the remaining 2 sibling. As it is now if your brother does not want to give a portion of his inheritance to his sister he is under no obligation to do so since he would be the primary beneficiary at that time.
What you need to check also is his will, to ensure that it includes the policy proceeds as assets. If so, after death assets are first directed to pay the expenses of his last illness. To me, this would include the funeral expenses.
The method of beneficiary designation now is a contingent one: you first, then contingently the other two, if you predecease him. At least that's how it sounds from your description.
I do think you need to find and review that will though, and if a general asset description doesn't include any insurance policies, contact the attorney who drafted it to prepare a codicil - assuming your father is cognizant to sign one.
Ask the attorney about why some assets like Life Insurance proceeds are designated to go outside of the Will and outside of Probate. They can explain that and how the beneficiary can use it for burial costs and how that's done.