Changing Union Fidelity Life Insurance Beneficiaries: A Step-By-Step Guide

It is important to periodically review and update your beneficiary designations to ensure your assets will be distributed according to your wishes. While it may seem like a set and forget decision, forgetting to update beneficiary information, especially after major life changes, could have substantial repercussions. For example, if you get married, you may want to update your beneficiary from your parents to your spouse. Similarly, if you get divorced, you may want to change your beneficiary to your new spouse or another family member. Updating your beneficiary is simple and only takes a few minutes online.

How to update your beneficiary online

Updating your beneficiary information is essential to ensure your assets are distributed according to your wishes. You can update your beneficiary designations by contacting the company or organization that provides your insurance or retirement plan. In most cases, you can do this online, but sometimes you may need to complete, sign, and mail a paper form. Here is a step-by-step guide on how to update your beneficiary online for Union Fidelity Life Insurance:

• Log in to your account: Visit the Union Fidelity Life Insurance website and log in to your account using your credentials. Make sure you have your login details ready.
• Navigate to the beneficiary section: Once you are logged in, navigate to the section for updating beneficiary information. This section may be called "Beneficiary Update," "Beneficiary Change," or something similar.
• Review current beneficiary information: Before making any changes, review the current beneficiary information to understand who is currently listed as your beneficiary. This will help you make the necessary updates.
• Select the option to add or change beneficiaries: Look for an option that allows you to add or change beneficiaries. This could be a button or a link that says "Add Beneficiary," "Change Beneficiary," or something similar.
• Provide beneficiary information: You will need to provide information about your new beneficiary, such as their name, relationship to you, and date of birth. You may also be asked for their mailing address, email, phone number, or Social Security number. Ensure you have this information ready.
• Select the type of beneficiary: Specify whether the beneficiary is primary or contingent. A primary beneficiary is first in line to receive the assets upon your death, while a contingent beneficiary will receive the assets if there are no surviving primary beneficiaries.
• Review and confirm the changes: Carefully review the information you have provided and confirm the changes. You may need to provide your consent or agreement to the changes by selecting an "I Agree" or similar option.
• Save the changes: Once you have reviewed and confirmed the changes, save them by clicking a "Save" or "Submit" button. This will ensure that your updated beneficiary information is recorded.
• Keep a copy for your records: After updating your beneficiary information, it is a good idea to keep a copy of the updated form for your records. You can usually download or print the updated form from your account.

Remember to review and update your beneficiary information periodically, especially after major life changes such as marriage, divorce, or the birth of a child. This will ensure that your wishes are carried out and your loved ones receive the intended benefits.

When to update your beneficiary information

It is important to keep your beneficiary information up to date to ensure that your loved ones can easily file a claim and receive the benefit quickly. Here are some instances when you should update your beneficiary information:

Marriage or Divorce

If you get married or divorced, you may want to update your beneficiary to reflect this change. This could involve adding your new spouse as a beneficiary or removing your former spouse as the beneficiary.

Birth of a Child

The birth of a child may prompt you to review your beneficiary information. You may consider naming your child as a beneficiary, especially if you are a single parent without a serious partner. If you have young children or minors who depend on you, you will need to choose an adult custodian or legal guardian to manage the benefits on their behalf until they turn 18.

Death of a Beneficiary

If your named beneficiary passes away, it is crucial to update your beneficiary information. The insurance company may not be able to process your claim if the named beneficiary is no longer living.

Change of Address

Even if you have the same beneficiary, it is a good idea to review your information at least once a year to ensure that their address and other contact details are current.

Other Life Events

Other significant life events or changes in your circumstances may also trigger a review of your beneficiary information. This could include changes in your relationships, family dynamics, or financial situation.

The dangers of outdated beneficiary information

When you purchase a life insurance policy, you are required to designate your policy's beneficiaries. This is important because it ensures that if the insured passes away, there is little trouble in determining who should receive the death benefit. However, it can be problematic when policy owners treat their beneficiary designations as set-and-forget, as circumstances change over time and a decision made at the policy's inception may not reflect the desires of the policy owner later on.

Life insurance policies, retirement accounts, certificates of deposit, brokerage accounts, and savings accounts are examples of accounts and assets that have named beneficiaries. These accounts and assets are automatically passed to those beneficiaries after death, and any wishes for those accounts or assets that are written into a Last Will and Testament are null and void. Therefore, it is crucial to regularly review and update beneficiary designations as life changes (marriage, children, divorce, etc.).

Failing to update beneficiary information can lead to several issues. Firstly, it could result in the wrong person receiving the benefits. Secondly, in the case of retirement accounts, if there is no designated beneficiary, the assets may be held in probate, a lengthy and complicated legal process where a court determines how to distribute the assets. This can delay the benefit payment and cause unnecessary stress for loved ones.

Additionally, outdated beneficiary information can impact the taxability of the death benefit. Typically, proceeds from a life insurance policy are tax-free and pass directly to the beneficiaries. However, if the beneficiary information is outdated, the funds may become part of the insured's estate, subject to estate taxes and accessible by creditors if there are unsettled debts. This can result in a decrease in the amount of the death benefit that the survivors receive.

To avoid these issues, it is essential to review and update beneficiary information regularly. It is also important to inform beneficiaries or trusted advisors, such as accountants and attorneys, about the existence of the policy and the name of the insurance company. Keeping beneficiary information up to date ensures that your wishes are carried out and that your loved ones receive the benefits you intend for them.

How to change your beneficiary by post

To change your beneficiary by post, you will need to complete a paper form and submit it to the relevant address. This can usually be done by downloading the form from the insurance company's website or by requesting one from their customer service team.

Firstly, you should check if you can update your beneficiary online. Many insurance companies, such as Fidelity, allow you to make these changes by logging into your account online. If you are unable to do so, or would prefer to update your details by post, you will need to find the correct paper form.

The form you require will depend on the type of insurance plan you have. For example, if you have a health savings account (HSA), you will need to find the specific form for this type of account. You can usually find the correct form by searching for it on the insurance company's website, or by contacting their customer service team. Once you have found the correct form, download and print it, or request that a copy be sent to you by post.

Once you have the form, you will need to complete it with the relevant details. This may include the name of your new beneficiary, their relationship to you, and their date of birth. You may also need to provide your own personal details, such as your name, address, and date of birth. It is important to ensure that all the information you provide is accurate and up-to-date.

After you have completed the form, you will need to sign and date it. Some forms may also require a witness signature, so be sure to check the requirements before submitting. Finally, send the completed form to the relevant address, which should be provided on the form or on the insurance company's website. Keep a copy of the form for your records.

When to seek legal advice

While changing the beneficiary on a life insurance policy is a straightforward process, there are certain situations where it is advisable to seek legal advice. Here are some scenarios where consulting an attorney can be beneficial:

• Understanding Legal Implications: Attorneys can provide valuable insights into the legal consequences of changing beneficiaries and the various types of powers of attorney (POA) available, including their limitations and the responsibilities of agents. They can explain the fiduciary duties of the agent and the potential consequences of any breaches.
• Drafting Tailored Powers of Attorney: Legal professionals can assist in drafting POAs that are specifically tailored to your circumstances and needs. This ensures that your intentions are accurately reflected and includes provisions that protect your interests. They can help you navigate the different types of POAs, such as general, limited, durable, and springing, and advise on the most appropriate option for your situation.
• Compliance with Legal Requirements: State laws outline specific requirements for creating valid POAs. Attorneys are well-versed in these laws and can ensure that your POA complies with the applicable legislation. This proactive approach can prevent future disputes or legal challenges related to the POA.
• Complex Family Dynamics: If you are considering changing beneficiaries due to complex family dynamics, such as divorce, remarriage, or the death of a loved one, legal advice can be crucial. An attorney can guide you through the legal implications and ensure that your beneficiary designations align with your wishes, especially if there are jurisdictional differences in how these situations impact beneficiary rights.
• Minor or Special Needs Beneficiaries: When considering naming minors or individuals with special needs as beneficiaries, consulting an attorney is highly recommended. They can advise on the best approach to ensure the beneficiaries' interests are protected. This may involve setting up trusts or custodial arrangements to manage the funds until the beneficiaries reach the legal age of consent or are capable of managing the finances independently.
• Dispute Resolution: In the event of disputes or unclear stipulations in existing POAs, seeking legal advice is imperative. Attorneys can help interpret the documents, protect your rights, and suggest appropriate courses of action to resolve the disputes. They can also assist in situations where the original beneficiary has passed away, and you need guidance on selecting new beneficiaries to prevent funds from falling into probate.

Frequently asked questions