What is An Insurable Interest Annuity For a Survivor? Sponsored by:Bill Hoff

Bill Hoff

According to Bill Hoff, By law, you are unable to give your federal retirement annuity to a survivor that is not your spouse or child. However, if you wish to provide a survivor annuity for an individual that does not qualify by conventional means, there is another option. You can provide an insurable interest annuity, which can be bought when you retire.

Bill Hoff Said You could provide this insurable interest annuity to any individual that depends on you financially and would have been receiving support from you if you had not passed away.

In a circumstance where a court blocked your spouse from getting a standard federal survivor annuity, you can provide them the insurable interest annuity. You are also able to assign this type of annuity to a relative (by blood or adoption) that is generally immediate family. Your ex-spouse or person that you are engaged to can also receive this benefit if it is recognized by the state that you reside in. Also, if you are in a situation where common-law marriage isn’t involved in the state that you are residing in, you can still provide this benefit if you lived in another state that recognizes common-law marriage.

If someone you want to assign the benefit to is not in the category mentioned in the previous paragraph, you can submit affidavits from one or multiple individuals that are familiar with the relationship that you have with this person. The relationship must be validated, and there must be proof as to how much this individual is dependent on you financially.  You also need to state the reasons why this person would still be receiving this financial support from you while still alive. When submitting these affidavits, it is also required to show that you are currently healthy, and that document must be signed off by a licensed doctor.

If you are approved for the insurable interest annuity for this person that is not normally considered for this benefit, the annuity will give this survivor 55% of the amount that you pick as the base when you purchase this annuity,

According to Bill Hoff,How much this will be annually depend on the age gap between you and the listed survivor and how much is available of your annuity base amount. The reason for the second is if there is another person that is supposed to get a survivor benefit.

So how much would your base annuity amount be reduced if you decide to go for an insurable interest annuity?

If the survivor is five years your junior, the same age, or older, the amount would be reduced by 10%. It would be reduced by 15% if the survivor is more than five but less than ten years your junior; 20% if they are over 10 but less than 15 years your junior; 25% if they are over 15 but 20 years your junior; 30% if they are over 20 but less than 25 years your junior; 35% if they are more than 25 but less than 30 years your junior; and 45% if they are more than 30 years your junior.

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