Survivors Can Bank Benefits, Skip Insurance Accounts
This article is for subscribers only.
Life insurance beneficiaries seeking federal protection for their money should take their proceeds straight to the bank rather than risk losing their cash by letting insurers hold onto it.
Policyholders may assume when buying life insurance that beneficiaries will get the payouts in a single bank check. That may not be the case, Bloomberg Markets magazine reports in its September issue. Insurance companies such as Prudential Financial Inc. profit by holding onto the money in their own accounts and issuing checkbooks, essentially IOUs, for survivors to access their money.