Your Michigan Wills, Trusts, & Estates Explained Simply: Important Information You Need to Know for Michigan Residents by Linda C. Ashar

Author:Linda C. Ashar
Language: eng
Format: epub
Tags: Michigan, wills, trusts, estates, estate planning, beneficiary, probate, trustee, assets executor, life insurance, power of attorney, advance directives, state law
Publisher: Atlantic Publishing Group
Published: 2012-05-10T00:00:00+00:00

Details, Details

It is all about the details when it comes to any kind of insurance; so, be sure to ask plenty of questions, and be extremely clear about what can, might, should, and will not happen related to your policies. Ask the hard questions, and do not accept anything less than a full response:

• Under what circumstances will the benefit not be paid? Find out all degrees of risk, including the worst-case scenario.

• Which of my assets are at risk and from what?

• What kinds of safety nets can insurance provide?

• What kind of insurance does not have a good cost/benefit balance, considering the details of my estate?

• What amount of coverage is excessive for my situation?

• Are there varying degrees of risk among my possible choices? If so, what are they?

• Why would my estate-planning team reject your recommendation?

Policies

With so many options, selecting what you need can be difficult. Check off those you think you might like to include in your estate plan, and then work with an agent to determine whether you need this kind of coverage.

While you are alive:

— Medical

— Dental

— Vision

— Disability — long-term

— Disability — short-term

— Long-term care

— Homeowner’s/renter’s

— Car

— Umbrella liability

After death:

— Life

— Whole life

— Universal life

— Joint first-to-die or second-to-die

— Term life insurance

— Annual renewable

— Decreasing

— Level

— Group

— Funeral/burial

Insurance for After You Are Gone

Some insurance agents will tell you that all you need is plenty of life insurance to make sure your loved ones are taken care of. Nod politely and then suddenly recall your breakfast/lunch/dinner with Uncle Greg that you completely forgot about. Leave immediately.

Insurance is not that simple. As with wills and trusts, there are many variations on this protection theme. The following are different types of life insurance:

• Whole life: Sometimes called cash value life insurance, this is the kind of policy most people know: After being qualified — smoker/non-smoker, desk jockey/bungee jumper, age 25/age 75 — the insured person pays a monthly premium on a policy that will, upon his or her death, pay a predetermined, fixed amount of money to his or her beneficiaries. A portion of the fixed (it will never go up or down) premium is invested, and another portion is placed into an account, such as a savings account, and that cash value is accessible to the policy owner. It can be borrowed against as a loan, or the cash can be taken as the proceeds of the policy instead of the death benefit payout.

_Universal life: A kind of whole life policy that guarantees a minimum return, but the value of the policy can go up or down. If the policy makes more money, the return might be high enough to cover your premium payments.

-Joint first-to-die or second-to-die: Just like it sounds, this is a policy held by two people, and the beneficiary is paid after the first person or second person dies. You decide the payout when you set the terms of the policy.

• Term life insurance: Carries an annual premium and pays a

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