What to do when a Mutual of Omaha account holder dies

No. Mutual of Omaha lets you update an individual beneficiary in Customer Access or over the phone at 800-775-6000, but it states that if you are naming a nonindividual — a trust, a charity, or a funeral home — you must download, complete, and mail the paper form. For life insurance that is the Application for LIFE Change of Beneficiary, Form L4237; for annuities it is the beneficiary form in the L8529 packet. The form is fussy in ways that get designations rejected: shares must be expressed as percentages and never as dollar amounts, corrections and erasures make the form unacceptable, and a separate form is required for each policy and each rider. Helpfully, the form prints Mutual of Omaha's own sample trust wording, including the testamentary-trust language "Trustee, or successor in Trust, named in the Last Will and Testament of the Insured; provided, however, that if no Trustee is appointed within one year of the Insured's death, payment shall be made to the Insured's estate." Mail it to Mutual of Omaha, 3300 Mutual of Omaha Plaza, Omaha, NE 68175, or fax 402-997-1906 (ATTN: Policyowner Services). Nothing is binding until it is recorded at the home office.

The Change of Ownership Form L6501, plus consents that catch people out. In a community property state, the current owner's SPOUSE must sign the Party-in-Interest Consent block before ownership can move — the form names CA, AZ, ID, NV, PR, TX, WA, LA, NM, and WI — so a married grantor in one of those states cannot fund an ILIT unilaterally. Any irrevocable beneficiary already on the policy must also consent. If the current owner is already a trust or a business, Mutual of Omaha requires the trust pages showing the trust has been executed and identifying the trustee and successor trustee, or a Board Resolution. And the step people forget: Form L6501 carries a printed notice that the death benefit remains payable to the BENEFICIARY of record, so transferring ownership to the ILIT does not make the trust the beneficiary — the new trustee must file a separate beneficiary change. Mutual of Omaha states the ownership change is unconditional and irrevocable once recorded, and that it is not responsible for the sufficiency or validity of the transfer. If an existing policy (rather than a newly issued one) goes into the ILIT, the three-year rule of IRC Section 2035 pulls the death benefit back into the estate if the insured dies within three years. Mutual of Omaha does not draft ILITs; consult a licensed attorney.

Yes, but not if the policy pays to an estate or to a minor. Mutual of Omaha allows an assignment of benefits, meaning all or part of the death benefit is paid directly to a funeral home or funeral funding company. It says verbal authorization from the beneficiary is enough to release the assigned amount, and that a written assignment signed by the beneficiary is needed if a claim packet is required for the claim. Then comes the limit that matters for estate planning: Mutual of Omaha states that if the policy is being paid to an ESTATE or to a MINOR, it cannot process an assignment of benefits at all. So a policy whose beneficiary is "the insured's estate" — which is what happens by default when every named beneficiary predeceases the insured — cannot be used to pay the funeral home up front, and the family fronts the funeral cost while the estate claim is processed. Note also that Mutual of Omaha pays claims by check mailed to the beneficiary on file; direct deposit is not currently available.

Neither one pays anything at death, and neither can be named to a trust — but both need action. A Medicare supplement policy has no death benefit and no beneficiary; it simply terminates. The executor's job is to stop the premium (it is commonly on bank draft and will keep drafting from the decedent's account until someone cancels it), ask for a refund of premium paid beyond the date of death, and resolve any Explanation of Benefits still in flight. A long-term care policy is a LIVING benefit, paid while the insured is alive when they are cognitively impaired or need help with at least two of the six Activities of Daily Living and the elimination period has been satisfied; it likewise pays nothing to the estate. LTC has its own department at 888-232-4597, separate from the life claims line, and health-coverage documents fax to 402-997-1869. Only life insurance and annuities produce a death claim at Mutual of Omaha.