Maximising your insurance proceeds 1

When comes to distribution of insurance proceed upon your demise, there are 3 ways this can happen.

1. Proceed to nominee(s) named in policy.
*** Bear in mind, though that the nominee who
receives the monies is not necessarily the rightful owner and may be holding the proceeds in trust for heirs.

2. Ignore / overlook nomination. Insurance company will only release the insurance proceeds to the personal representative of the estate under the Insurance Act 1996
*** Family members would face a delay in distribution in view of the duration taken to obtain the relevant letters of representative from the court.
*** The timing is depend of course on whether there is a Will or otherwise.

3. Through an insurance trust.
*** The trust deed, either executed by you and the trustee company, will indicate the roles and obligation of the trustee in handling the insurance proceeds for the beneficiaries.

From these 3 methods, 1st method seem to be the simplest & easiest. However, apart from the question of ownership of monies received, a nomination does not address some situations.

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Source: Rockwills Corporation Sdn Bhd. (Maximising your insurance proceeds)