Finance Blog

Four Important Life Insurance Details you Must Share with your Family

You have bought life insurance to protect your family. And you must share details of this policy with them. There is a significant step to take after you buy a life insurance policy before you can confidently say you have fully protected your family. After buying the policy, you might ask yourself “what my family needs to know.” Whether your beneficiary is your spouse, child, sibling, or business partner, you must share the following formation with them.

Your Beneficiaries

If your beneficiary does not make a claim after you die, it can take a longer time to wait for the insurance company to track down your beneficiaries. However, if for example, your partner is aware of the existence of your life insurance policy and they are the beneficiary, they can make a claim right away, easing the financial burden of funeral and ongoing expenses. In addition, you may want to inform other beneficiaries such as a parent, a business partner, or an adult child. Letting your family know your nominated beneficiaries’ identities may help them prepare for where the money will go when you die.

The Insurance Policy Account

Letting your family know a few details about your insurance policy account will help make it easier for them to pursue a claim in your absence. Always keep your policy documents in a safe place, with a copy of your will. Also, have a document that clearly identifies your investments including your managed funds, life insurance, superannuation fees, and others.

Where the Details are Stored

Aside from knowing about your life insurance, your family must also know where to find the documents. Also, consider making the documents easy to find. Think about storing both a hard copy and an electronic copy of your policy details. Store the electronic copy in a secure data file and the hard copy under lock and key.

The Exclusions of your Insurance Policy

Make sure to tell your family about the terms of your policy. This helps them become more aware of their rights to make a claim. A lot of life insurance policies, for example, don’t cover death that resulted from suicide or a self-inflicted injury within a certain period from the start date of the policy. Also, policy coverage may not include some lifestyle or health conditions. For instance, if you have a history of a heart problem, your insurance company may exclude any future heart issues form a possible claim.

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