The estate administrator is the person responsible for distributing the assets that an individual has left behind. An elderly person has written a well specifying which assets are supposed to go to which airs. The administrator doesn’t make these decisions. But they do distribute the wealth, inventory the assets, and then distribute them in accordance with that will.
One major asset that people have is a life insurance policy. In fact, for some people, this is their main asset. They have purchased that policy and they’ve been paying into it for years because they know that it is going to give their heirs a significant amount of money when they pass away. Does this mean that the estate administrator needs to address the life insurance policy while splitting up the assets?
It should happen automatically
Most of the time, the estate administrator actually isn’t involved. This is because a life insurance policy already has a beneficiary. As soon as someone passes away, and once that has been shown to the life insurance company, they are going to pay the beneficiary the balance of the plan. The estate administrator doesn’t have to divide it between different heirs because it just goes to whoever is listed – and that can be multiple people.
There is one uncommon exception, which is where a beneficiary has either passed away or where a beneficiary was never named. In a situation like this, then the life insurance may pay out into the deceased person’s estate. That would mean that the money does have to be divided in accordance with the will. But this step generally gets skipped because the insurance company already has the beneficiary they need.
Situations like this can become complicated, so all involved need to understand their legal rights.