Life insurance for 74 year old, and using cash in bank account.

Bryn99

Hi everyone.

I've been using this site for years as a lurker, making use of the great advice given here, so first I want to say thanks.

The main reason for this post though is that my 74 year old Dad is going to get life insurance, something he should have done a long time ago, so any advice on which company/service would be best for him would be much appreciated.

More importantly though is the fact that he has a little over £3,000 in his bank account, and he has suggested that should he die before the first 12 months of the life insurance is up (because he won't be covered for that period), the family could take that money out and use it as part of the funeral expenses.

As his oldest Son, that would mean I was responsible for the arrangements, and I just get the feeling that the money shouldn't be touched, as it's part of his estate?
I know very little about this, so I could be a mile off, but I just want to know for sure where I stand.

He doesn't have a will yet, something that he's going to sort out, so I don't know if that affects the above question.

Btw, he's fine, and we hope he's with us for many years yet, but it's something that he wants sorted, so it's got to be talked about.

Thanks for any advice you can give.
Would really like to get the information down, so we can sort it out, and he can get on with enjoying life, instead of talking about these things.

Thanks again,
Bryn.

DUTR

Do you have a will?

Bryn99

No, as I said above, he doesn't have a will yet, but he is going to sort that out.
Does that affect if the money in his account can be used?
I thought it might, but I really don't know.

societys_child

the family could take that money out and use it as part of the funeral expenses.

As his oldest Son, that would mean I was responsible for the arrangements, and I just get the feeling that the money shouldn't be touched, as it's part of his estate?

I thought the idea was that the estate should be used to pay pay for such things.

Bryn99

societys_child wrote: »

I thought the idea was that the estate should be used to pay pay for such things.

Well, yes, that's what I've always thought, but I just wanted clarification on that.
I don't keep up with such things, and there's a lot of red tape out there.

What I didn't want was me using that money for the funeral, and then further down the line getting in trouble for using it without the proper authorisation.
Not sure if that's a thing.
I really wouldn't know.

HappyHarry

Bryn99 wrote: »

Well, yes, that's what I've always thought, but I just wanted clarification on that.
I don't keep up with such things, and there's a lot of red tape out there.

What I didn't want was me using that money for the funeral, and then further down the line getting in trouble for using it without the proper authorisation.
Not sure if that's a thing.
I really wouldn't know.

Funeral expenses are a legitimate expense for the estate of the deceased, and are usually paid by the estate.

Quentin

Your don't even know if you are to be his executor yet.

His funeral bill will be dealt with by his executors (assuming he does leave a will) as part of sorting his affairs before paying any benefactors their share of the estate

Whatever the situation about a will you won't be able to touch his money in the bank without proper authorization

Bryn99

Quentin wrote: »

Whatever the situation about a will you won't be able to touch his money in the bank without proper authorization

OK, so as it stands, without a will, that money can't be touched.
Good to know.

I've just been looking at various Life Insurance deals, and there seems to be short, medium, long and whole life terms.
I presume that apart from the whole life one, the others only cover you for the term (6 years on the short one), and if you outlive the policy then the policy no longer covers you, and you get nothing back?

So I'm looking for a whole life one?
Best quote (AEGON) was £30 p/m for £5000 cover, which would be fine.

Thanks for all your help so far.

agrinnall

At £30 a month if he lives for just over 8 years (assuming no premium increase) then he'll have spent all of his £3000 savings, at which point he'll be penniless and won't be able to continue the policy anyway. I don't really get why people worry about funeral costs, particularly when they probably have enough money in their estate to pay them anyway.

ThinkingOutLoud_2

Just to bring together several strands.

Dying intestate is not what you or he or anyone in the family want. Quentin is telling you that it is the executors who must do the right thing with the money. This won't be you without a will making you executor. Crack on with a basic will.

Funeral expenses are usually taken from the estate. If there is not enough money there ... hence making provision for enough is a good thing.

To be honest while you can spend the earth on a funeral - £3k+ is going a fair way towards or even enough for a modest affair. Depends how you define modest.

If you consider paying £30 a month means £360 a year. In three years if he put that money in his savings he'd have £4K+

So as with all life insurance - it is a gamble which pays off it you die or if you don't - except you don't have that premium.

If he lived 14 years more he will have paid in as much as the policy will pay. And if he doesn't die by then he will have to keep paying to see his 5k. If only we knew how long.

I guess my point is there is another option - if the 3k is nearly enough - bank the £360 every year until the funeral is "paid for" - then he can spend or dole out the extra to his family himself as he chooses! There is the risk he dies before but ...

Well done for thinking on this. Not easy but easier than not.

Bryn99

agrinnall wrote: »

At £30 a month if he lives for just over 8 years (assuming no premium increase) then he'll have spent all of his £3000 savings, at which point he'll be penniless and won't be able to continue the policy anyway. I don't really get why people worry about funeral costs, particularly when they probably have enough money in their estate to pay them anyway.

Actually, he could afford that amount without touching his savings, just from his pension.
But I see your point.

He now seems set on one of the prepaid funeral plans from the CoOp.
I've looked it over, and it seems quite reasonable, and you get it at today's prices, with everything pre-arranged, right down to the music, the route, etc.
Any thoughts on these?
I know why he likes the sound of it, because he doesn't want anyone having to deal with all this when he goes, and he'll be happy knowing no-one has to.