Legal Question in Insurance Law in California

Irrevocable benificiary of a minor My grandparents took a $10,000 life insurance policy on me when I was 4 years old, it was a 20 year policy that was paid up in 1997. My grandparents named themselves and my mother as irrevocable benificiaries. Both grandparents are deceased, but when my grandmother died last year the policy was sent to me. My mother(the last living irrevocable benificiary) will not sign unless she recieves a large portion of the money. Since I am the owner of the policy, and it was taken out when I was a minor is there anything I can do to close out the policy without my mothers ''irrevocable benificiary'' signature? The insurance company (SFB in Jackson Mississippi) says I have to either have her signature, or wait until she is dead, providing death certificates for both my grandparents and my mother. Help, Catheryn


Asked on 8/07/09, 9:19 pm

1 Answer from Attorneys
Gerry Goldsholle Advocate Law Group P.C.

I assume you are about 25 years of age or less, and in decent health.

Life insurance policies on children's lives are a horrible scam and sold by high pressure sales people primarily well meaning but ill-informedpeople. They make little sense for anyone except the agent that sells them and the company that issues them.

Given normal life expectancies (unless you are in very bad health) you have over 50 years of life expectancy. That means absent an accident or very premature death, in 50 years someone will inherit the policy proceeds of $10,000.

What do you think the expected future value of $10,000 is today, as no one can collect it until some 50 years from now is? Assuming there is an average 5% interest rate from now until then the present value of that $10,000 is less than $800. http://jcooney.ba.ttu.edu/fin3322/Brealey Files/Appendix A - Present Value Tables.pdf

At a capable lawyer's hourly rates, writing a letter to your mother or the insurance company will cost more than someone would get in 50 years.

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Answered on 8/07/09, 10:42 pm


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