Choosing a Beneficiary or Custodian

One final detail that all parents need to consider when arranging their life insurance policy is choosing an appropriate beneficiary or custodian. When minors are involved the “primary beneficiary” is the person who will be taking care of them financially, and in most cases, caring for them physically as well.

For example, in a family situation the wife would be the beneficiary of her husband’s policy, and vice versa. This means that should one parent die, the other parent will have the ability to manage the money left from the life insurance policy.

But what if both spouses die, they are divorced, or only one parent raises the children?

This is why you should always have a custodian chosen in the event that no parent is able to care for your child or children. If you do not select someone to manage their money, the courts will do so, and they might not choose the person you would want in charge of a large financial sum.

Learn about the The Uniform Transfers to Minors Act, or UTMA

Affordable Life Insurance Rates
Are Waiting For You!
Choose Your State

Related Information

Can You Take Out Life Insurance on Your Parents?

It's possible to buy a life insurance policy on your parents. There are actually a few good reasons for doing so.

Read More

Life Insurance | What's The Point?

Life insurance can help you protect your loved ones financially in the event of your death. Learn more about why it matters.

Read More

Why Have a Life Insurance Policy?

Here are 7 essential reasons for you to have life insurance. Compare term and whole life insurance and find a policy that's right for you and your family.

Read More

Who Should Get Life Insurance?

Thinking about getting a life insurance policy? Here's what you need to know about purchasing one.

Read More

Life Insurance for Your Mortgage

You aren't required to have life insurance to get a mortgage, but having a life insurance policy while you are making mortgage payments could be beneficial.

Read More

When the Beneficiary of a Life Insurance Policy Is Contested

There are cases where the beneficiary of a life insurance policy is contested, meaning that people don't agree on who should receive the policy payout.

Read More

I Have No Dependents. Should I Get Life Insurance?

Just because you don't have dependents doesn't mean you don't need life insurance. Find out why purchasing such a policy is still a good idea.

Read More

What Does A Whole Life Insurance Policy Cover?

A whole life insurance policy can be used to cover a wide range of expenses, from funeral and burial costs to your child's education.

Read More

Who Gets Your Life Insurance Payout?

The person or entity that you name as beneficiary on your life insurance policy contract will receive the death benefit proceeds when you die.

Read More