Employer names self as beneficiary on life insurance

[CJGS]

What is the name of your state? TX

Life insurance is company paid. The form I was given to complete had the Employer already pre-filled as the beneficiary. Is this legal?

 

[longneck]

yes, and it's very common for business-critical employees, such as CEO's, personalities, etc.

 

[ecmst12]

I've heard that Wal-Mart does this with all its employees too....not sure if it's actually true...

 

[Beth3]

yes, and it's very common for business-critical employees, such as CEO's, personalities, etc.

That's called "key man" insurance. But if this is not a top executive and this isn't a life insurance policy that's separate from the life insurance offered through the employer's group health plan, then I'd sure question it and give my State's Office of the Insurance Commissioner a call.

 

[Betty]

I agree with Beth - if it is key-man ins. on a "key employee" with the co. being owner of the pol., prem. payor & bene of the ins. proceeds, it would be ok. However, I would question it also if it is employee life ins. under an employer's group ins. plan. The employee would normally get to name the beneficiary.