Insights

In Ningbo, when parents purchase insurance for their children, who should be named as the policyholder—the parents or the child?

Ningbo Author：LuXu WANG

The same is "parents pay to buy insurance for their children", another way to ask: will this policy be divided in the four scenarios of children's divorce, parents' divorce, parents' debt and children's debt? This is closer to the real demand than "who is better to be insured. Direct conclusion: the policyholder determines the ownership of the cash value of the policy, which also determines its "isolation position" in the four types of risks-parents are the policyholder, and the policy isolates children's marriage and children's debts; When children are policyholders, the policy isolates parents' marriage and parents' debts. No matter who is the policyholder, as long as the premium comes from the joint property of husband and wife and occurs within marriage, the corresponding cash value may be divided in the event of divorce. The effect of isolation depends on the three elements of "the point of insurance + the source of payment + the beneficiary arrangement", which has little to do with who "pays.

Breaking down the risk of segmentation in each of the 1. four scenarios

  1. scene 1: Will the policy be divided if the children divorce? The insured is the parent, the cash value belongs to the property of the parents, not within the scope of the joint property of the children and husband, will not be divided, the insured is the child, the cash value belongs to the child, the corresponding part of the premium paid after marriage belongs to the joint property of the husband and wife, will be divided.
  2. Scene 2: When parents divorce, will the insurance policy for their children be divided? The key depends on whether the premium comes from the joint property of the parents and husband. If both parties agree to insure their children, judicial practice is usually regarded as a gift to the children. The insurance policy belongs to the children and is not divided when the parents divorce. If one party uses a large amount of common property to insure his children on the eve of divorce without consent, he may be deemed to have transferred the property, and the party shall be divided less or not in accordance with Article 1092 of the Civil Code.
  3. Scenario 3: Will the policy be enforced if the child is in debt? If the insured is a parent, it will not (the cash value is the property of the parents).
  4. Scenario 4: Parents are in debt, will the policy be enforced? If the insured is a parent, the cash value belongs to the property of the parent's responsibility and may be frozen and deducted; if the insured is a child, it is difficult to reach in principle, but if the parent suddenly transfers funds to the child to insure after the formation of the debt, the creditor may request the revocation of the gift in accordance with Article 538 of the Civil Code, and the risk remains.

2. Marital Premiums: A Dividing Line That All Structures Can't Get Around

to judge the fate of the policy in divorce proceedings, the first step of the court is to check the source of payment. The premium paid on the joint property of the husband and wife after marriage, regardless of which party the insured is, the corresponding cash value of the policy is the joint property of the husband and wife. Need to prompt three points:

  1. the cash value is not equal to the premium paid, in previous years, the withdrawal or division is often lower than the total amount paid, early withdrawal of "money" often lose, in practice more choose to retain the policy + cash compensation;
  2. if one party advocates the division of the other party's policy, it must first prove the existence of the policy and the premium comes from the common property-policy inquiry (gold matter pass App, insurance company customer service) and payment flow is the key evidence;
  3. pre-marital insurance, after marriage to continue to pay the policy "divided into two": pre-marital individual payment corresponding to the cash value of the individual part of the policyholder, after marriage co-payment corresponding to the part of the division into the scope of the division.

3. beneficiary design: how to "bypass" divorce and inheritance.

The beneficiary arranges to determine the direction of the death insurance. Article 42 of the Insurance Law stipulates that after the death of the insured, the insurance premium shall be treated as an estate in only three cases: (1) if there is no designated beneficiary, or if the designation of the beneficiary is unknown and cannot be determined; if the (II) beneficiary dies before the insured, there are no other beneficiaries; if the (III) beneficiary loses the right of benefit or waives the right of benefit according to law, and there are no other beneficiaries. In other words, as long as a clear beneficiary is designated, the death insurance premium will not enter the estate, will not be transferred between the spouse and parents of the child according to the legal inheritance, and will not be affected by the marriage of the child-the insurance premium directly belongs to the beneficiary and has strong personal attributes.

There are four common types of mistakes: the beneficiary column is blank or "legal" (becomes an estate); Only write the identity relationship but not the name (e. g. "spouse", the change of identity after divorce causes disputes); The children did not change in time after the death of their parents; The relationship between the insured, the insured and the beneficiary has not been adjusted synchronously due to the change of marriage. It is recommended to review the policy regularly and the beneficiary to write "name + identity relationship" and keep it updated.

4. insurance is not a shield for transferring property

A boundary that must be repeatedly emphasized: the segregation clause fails to transfer and conceal the joint property of husband and wife in the name of insurance. Article 1092 of the Civil Code stipulates that if one of the spouses hides, transfers, sells, destroys, or squanders the joint property of the husband and wife, or forges the joint debt of the husband and wife in an attempt to embezzle the property of the other spouse, the divorce may be divided less or not. Specific to the insurance scenario:

  1. before the divorce surprise large insurance (wholesale, additional premiums), the flow of funds can be checked, the court may determine the transfer of property;
  2. if a policy is purchased for a third party and the premium is paid with the joint property of the husband and wife, the gift is invalid in violation of public order and good customs (Article 7 of the Interpretation (II)), and the other party can recover it;
  3. if the husband and wife's common property is used for profligacy such as large-sum rewards on the network platform, Article 6 of the (II) of interpretation clearly can be identified as "profligacy". During marriage, they can request to divide the common property, and during divorce, they can request to divide the common property without dividing it-the policy structure should truly serve the protection and inheritance, not hide the assets.

Dynamic adjustment of 5.: the structure will not move until it is signed.

The insurance structure should be adjusted according to the family stage: when the children are minors, the parents are the insured + the parents are the beneficiaries, leaving the death payment in their own hands to ensure the growth of the grandchildren; After the children become independent as adults, they may consider changing the insured to children to realize the transfer of control. After the children are married and their marriage is stable, if they want to prevent "outflow", they can change the insured back to their parents. Each change should be noted: the change of the insured must be approved by the insured, involving the transfer of cash value, should retain a written gift or transfer documents, to avoid later identified as unclear "holding". On the combination tool, large annuity policy can be matched with insurance fund trust, to achieve "conditional installment payment", more than a one-time payment can prevent profligacy and marital outflow.

List of high-frequency errors in the 6. insurance structure.

The most error-prone links are listed together, and the control check can avoid "free purchase of insurance policies":

  1. separation of money and name: parents pay but let their children sign the bill and deduct the money, the policy belongs to the children, and the direction of isolation is opposite to expectations;
  2. the beneficiary is blank or general: if the beneficiary is not designated, only "spouse" and "legal" are written or the identity relationship is not written, the death payment may return to the estate, trigger inheritance competition, and lose the function of marital isolation;
  3. the beneficiary's first death is not changed in time: if the child is designated as the beneficiary, if the child dies before the insured, if there is no beneficiary, the insurance money will fall into the estate;
  4. the beneficiary intentionally causes the death of the insured: Article 43 of the Insurance Law stipulates that if the beneficiary intentionally causes the death of the insured, he loses the right to benefit-there is no room for "insurance for insurance;
  5. marital common property payment is not fortified: after marriage, the joint account is used to pay without property agreement, the cash value is recognized as common property, the structure is also within the division line;
  6. take insurance as a transfer channel: on the eve of divorce, a large amount of insurance, the purpose is identified as the transfer of common property, the policy is not only not isolated protection, but become the basis for less division.

7. choose configuration scheme by family structure

different risk structures correspond to different architectures, with three typical scenarios for reference:

  1. unitary funding to prevent children's marriage change (Ningbo small and medium-sized enterprise main family common): Parents as the insured and children as the insured or beneficiary, the premium is paid directly by the parents' account, the death of the designated grandchildren as the beneficiary-segregated children's marriage and debt, wealth in the family;
  2. the husband and wife jointly plan the old-age and inheritance: the two parties are the insured and the beneficiary, the children are the beneficiaries, the joint payment within the marriage, the simultaneous signing of the husband and wife property agreement to clarify the ownership of the policy rights and interests, to avoid the cash value dispute in the event of divorce;
  3. cross-generational inheritance anti-profligacy: large life insurance docking insurance trust, death benefits into the trust according to the conditions of installment payment, not only to isolate the risk of marriage and prevent one-time payment is squandered, suitable for the wealth of a large amount, the second generation of self-control doubts of the family.

8. policy holding and truthful notification: two hidden risks

outside the insurance structure, two hidden problems often erupt only during claims or divorce:

  1. disputes over the attribution of the "surrogate" policy: when the parents pay but insure in the name of their children (or vice versa), the cash value attribution of the policy will be disputed when the registered policyholder is inconsistent with the actual investor-in principle, the policy registered policyholder shall prevail, but the actual investor can claim real rights based on the transfer record and written agreement; When divorce is divided, the court will review "who insures, who pays and who controls", the three are consistent in order to avoid one of the spouses claiming that the policy is the joint property of the husband and wife or that the relationship is not established. Those who want to use a nominee to circumvent division or enforcement often fail at both ends: the spouse of the registered policyholder can claim division, and it is difficult for the actual contributor to prove the right. The compliance practice is not to hold on behalf of, directly to the policyholder;
  2. claims risk not truthfully informed: If the insured person is required to truthfully inform the health status, intentionally or due to gross negligence not to inform the facts sufficient to affect the underwriting decision or rate, the insurer may terminate the contract in accordance with Article 16 of the Insurance Law and shall not be liable for payment (if it is deliberately concealed, the premium shall not be refunded). Concealing the medical history for "smooth insurance" may make the whole policy meaningless at the critical moment-this is different from the separation of marital property, but it also determines the success or failure of the policy structure.

It is also necessary to remind the difference between "policy holding" and "insurance for children": parents insure minor children is a legal structure (the insured has an insurance interest in the children), not a substitute. Any nominee arrangement is recommended to be supported by a written agreement + clear funding and regular review, otherwise it is better not to do so.

9. FAQ

insurance for the spouse during marriage (the spouse is the insured and the insured), what happens in the event of divorce?

The policy belongs to the policyholder, but the cash value corresponding to the premium paid after marriage is common property, and the policyholder usually continues to hold and compensate half of the cash value of the other party in the event of divorce. Health insurance, accident insurance and other protection products cash value is very low, the practice is not divided, the respective policies to stay.

Can you ask the other party to change the beneficiary of the policy to yourself when you divorce?

cannot be enforced. The right of benefit is the right of the insured and the insured to change unilaterally, the divorce does not affect the rights and interests of the existing beneficiary, nor does it give the other party the right to force the change, but if the death insurance may be used as an inheritance in the future (the beneficiary is not designated), the beneficiary arrangement may be agreed through the divorce agreement as a supporting content of the property division.

Parents buy insurance for their children, children divorce when the other party claims division, how to defend?

The core defense is "the policy is not the joint property of husband and wife": show the insurance contract and payment account of the insured (parents) to prove that the premium is paid by the parents and the cash value of the policy belongs to the parents; If the policy annuity or survival benefit is mixed into the joint account of the husband and wife after receiving it, the mixed part may still be claimed to be divided-received in a separate account in advance.

Can the policy continue to be valid after the death of the policyholder?

Can. The cash value of the policy after the death of the policyholder as his estate may be negotiated by the heirs to determine the new policyholder to continue to pay (subject to the consent of the insured), the contract continues to be valid. If the parents are the insured and want the policy to continue to provide protection for their children behind them, it is recommended to arrange the rules of succession of the insured in advance and state it in the will.

Parents pay, children as policyholders, parents can go back to the policy?

generally cannot. Parents insure their children and deliver the premium to the insurance company and register the policy in their children's name, which is usually regarded as the completion of the gift, and parents cannot take it back at will with "the money is mine"; Unless the gift is conditional and the conditions are not fulfilled, or it can be proved that the two parties are actually "holding" and have a written agreement. If you want to retain the leeway or control at the time of capital contribution, the parents should be the insured directly, rather than claiming to "take it back" afterwards ".