It may sound odd to get a life insurance policy and name yourself as the beneficiary, but it’s possible to do within specific circumstances. You can take a life insurance policy out on someone else, but there are limitations.
What Do I Need To Take A Life Insurance Policy Out On Someone Else?
Getting insurance for someone else requires insurable interest and consent. You cannot purchase a life insurance policy for someone else without their knowledge, and you cannot do it with the intent of profiting from their death. The person you’re getting the policy for will have to undergo the life insurance medical underwriting as if they would if they were purchasing it for themselves. They must also provide a signature.
Insurable interest comes down to dependence. If you benefit more from a person being alive and rely on them financially, you have insurable interest in them.
Can I Get A Life Insurance Policy For A Non-Family Member?
Business partners often take out life insurance policies for each other. They have insurable interest because they rely on each other to carry out business operations.
If you’re a business owner, you can get insurance for a highly valuable employee. This is also called key employee or key person insurance.
What If I Want To Get A Policy For My Spouse?
You can take a life insurance policy out on your spouse, especially if you rely on him or her for income. You have insurable interest because of this dependence.
You can also do this for an ex-spouse. If you’re depending on the other for spousal and/or child support payments, then you would be able to do this. Some courts actually require this during the divorce process.
Can I Get Life Insurance For My Children?
Getting life insurance for children is different. Parents often do this, but grandparents and legal guardians are also able to buy life insurance for children. These are usually bought to help pay for education, and the type of insurance is a permanent life insurance policy that grows in cash value. This is the only situation in which medical exams and signatures aren’t required.
What If I Want To Take A Life Insurance Policy Out On My Parents Or Siblings?
Getting life insurance for your parents is useful if you cosign on a loan with them or if they don’t have life insurance. You can attach riders to cover estate taxes from inheritance and long-term care.
It is good to get life insurance for your siblings if they are responsible for caring for at least one of your parents. This way, if they pass away, you will be able to fund long-term care or associated costs.
Need Coverage? We Can Help!
Remco Insurance Services is your number one option for finding you quality insurance. We want you to get the best policy for you and those who are important to you. No matter your goals, we’re here to help. Call us today at (215) 357-7878 or text (267) 692-8296.
