Was my cousin allowed to purchase life insurance for my mother?

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Dear Penny,

My mother passed away after several years of Alzheimer’s in the Philippines. While she was living in Maryland, a cousin took out an insurance policy on her. She agreed knowing that she would only pay $ 50 per month and that the rest would be taken care of by her niece.

Now my cousin is asking for four death certificates and wants me to fill out forms because, according to her, I am the beneficiary. If she owns the policy, what has that got to do with me? I requested a copy of the policy because I have no idea what it is trying to do. Please help.

– Confused girl

Dear confused,

Trust your instincts. Do not give your cousin your mother’s death certificate or any personal information she asks for.

There are a lot of things that seem sketchy here. The biggest red flag is that your cousin had a life insurance policy on your mother. You can’t just take out an insurance policy on just anyone. Imagine how abusive the system would be if we could all bet on each other’s lives.

Robin hartill [ The Penny Hoarder ]

To have a life insurance policy on someone else, you must have an insurable interest in their life, which means that you would suffer financial loss if you died. It is generally assumed that you have an insurable interest in the life of your spouse or child. You may even have an insurable interest in your ex-spouse’s life if they’ve been ordered to pay you alimony or child support. But a niece is unlikely to have an insurable interest in her aunt’s life, unless there are unusual circumstances – such as if they were business partners or your cousin had co-signed a loan for your mom.

You also need the person’s consent to purchase life insurance. I have to ask myself: did your mother fully understand what she was signing? Or if you only recently discovered this font, is it possible that your cousin forged her signature? It’s also strange that your mother made partial payments if your cousin owned the policy.

It is quite unlikely that your cousin bought life insurance for your mother out of the goodness of her heart. A more realistic explanation would be that she plans to pocket most, if not all, of the proceeds.

You can continue to pressure your cousin for a copy from the police. But don’t be surprised if you come across a flurry of convoluted excuses and explanations. Even if your cousin provides you with the document, I wouldn’t assume it’s legitimate. Contact the insurance company directly to verify the policy. You can provide the death certificate to the insurer directly if it is legitimate. The company can send you all the necessary forms.

If your cousin refuses to cooperate, you can search online for the National Association of Insurance Commissioners. life insurance policy locator. The organization will ask participating companies to search for fonts in your mother’s name. If they find a policy and you are the beneficiary of it, they will provide you with the details. Your cousin doesn’t need to be involved. Even if you are not a beneficiary, you would probably be entitled to receive this information as your mother’s next of kin.

If you think your cousin had bad intentions, consider contacting your state insurance commissioner. Some people are reluctant to report family members to the authorities. But if you think your cousin ripped off your mom, she could easily do the same with others. Older people are particularly vulnerable to being scammed by people they trust, such as family members. At the very least, you should warn other family members if you think this has happened.

Your cousin probably got some identifying information about your mother, like her Social Security number, when she got the police. Unfortunately, people who have died risk having fraudulent accounts opened in their name. A good idea would be to contact each of the three credit bureaus to let them know that your mother is deceased.

I’m sorry you have to deal with all of this on top of the loss of your mother. But you have every right to be suspicious here. Don’t let anyone, especially your cousin, tell you otherwise.

Robin Hartilll is a Certified Financial Planner and Senior Writer at The Penny Hoarder. Send your sensitive money questions to [email protected].


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