Issue link: http://clhia.uberflip.com/i/405151
12 HOW TO MAKE YOUR LIFE INSURANCE WORK FOR YOU At the time of a divorce settlement, if you are the person who is to receive support money, make sure your payments are insured. There are two ways of doing this using either existing or new policies: 1. Make it part of the formal agreement that your ex-spouse take out life and disability insurance on his or her life naming you as beneficiary. If you want to ensure that the beneficiary can't be changed without your consent, require your ex-spouse to name you as irrevocable beneficiary. 2. Take out a life insurance policy on your ex-spouse's life. Name yourself as beneficiary and pay the premiums. Then nobody can cancel the policy and you have control. Divorce If your beneficiary predeceases you, the insurance money goes to your estate unless you have named a contingent beneficiary. In the case of death at the same time (e.g., in an accident), insurance law provides that the beneficiary is deemed to have died first. Again, the insurance money goes to your estate unless you have named a contingent beneficiary. What Happens If My Beneficiary Dies First Or At The Same Time? If the beneficiary is under the age of 18, the insurance company can pay the insurance money to a trustee (designated by the insured) who can receive funds on behalf of the minor. Alternatively, in most provinces, the insurance money can be paid into court until the beneficiary can give a valid discharge on receipt of the money. What Happens If My Beneficiary Is A Minor? You can use a life insurance policy to make charitable donations. On your death, the proceeds go to the organization you have named as beneficiary. If the charity is registered with Revenue Canada, the premiums can be tax deductible. Leaving Money To Charity