Insurance matters in your estate

Your insurance policies are just as important as your home, savings, and heirlooms when settling your estate. Executors often overlook them, creating serious problems for heirs.

Four common executor problems

Executors struggle with not recognizing policies exist, outdated beneficiary designations, lapsed coverage from unpaid premiums, and confusion about who collects the proceeds.

Life insurance payouts get missed

Nearly half of parents say life insurance is a key part of their children's inheritance, but heirs often don't know the policy exists and miss filing claims.

Outdated beneficiaries cause problems

If you designated a beneficiary years ago and never updated it, your life insurance payout might go to someone you no longer want it to go to.

Heirs don't know where to look

A Kiplinger survey found that 35% of adult children didn't know how to access their parents' wills, estate documents, or beneficiary information even when they knew it existed.

Home insurance needs attention

While an estate settles, your executor must keep the home insured. If coverage lapses or the insurer isn't notified of your death, a fire or theft could leave the estate unprotected.

Vacant homes need special coverage

If a home becomes vacant during estate settlement, your executor should notify the insurer. Empty homes face different risks like vandalism and theft, which may require different coverage.

Car insurance coverage can lapse

Your executor should contact the auto insurer before anyone drives an inherited vehicle or before coverage is canceled. Who can drive and how long coverage continues depends on the policy.

Create a policy inventory

Make a single spreadsheet listing every insurance policy you own. Include the company name, policy number, agent contact info, what it covers, premium amount, and where to find the actual policies.

“A consolidated inventory of all of your insurance policies is perhaps the single most valuable thing you can leave for your executor.”

Update your inventory annually

Review your insurance inventory every year as premiums and coverage types change. Update it immediately whenever you switch home or car insurance.

Store it securely and accessibly

Keep your inventory in a password-protected cloud file or encrypted digital safe that your executor can access. Balance security with accessibility so your executor can actually find it.

Tell your executor it exists

Creating an inventory is only half the battle. Your executor must know it exists and know how to access it. Make this conversation part of your estate planning.