Chapter 44

○ A personal representative appointed by the probate court to oversee the probate process for someone who has died intestate (or without appointing an executor).

Administrator or administratrix.

codicil

An amendment to a will

nuncupative will

An oral will

Provides payment to a beneficiary during his lifetime

Annuity

are the reverse of life insurance—they make payments until death,

Annuity

Living wills (also called advance directives) allow people to:

Appoint a health care proxy Refuse, in advance, medical treatment that would, in their view, unreasonably prolong their lives, Resolve disputes among family members.

The person who receives the proceeds from the insurance policy

Beneficiary.

These are among the advantages of a trust:

Control Caring for children. Tax savings. Privacy. Probate Protecting against creditors

means pouring the assets out of one trust into another. This process can be used for two purposes:

Decanting ,1. changing the terms of the original trust or 2. distributing all of the trust assets to the beneficiaries

○ The person who has died.

Decedent.

○ means someone who inherits under a will.

Devisee or Heir

Replaces the insured's income if he becomes unable to work because of illness or injury

Disability insurance

. Someone who makes a gift or creates a trust

Donor

inter vivos trust,

Established while the grantor is alive

○ The process of giving away property after (or in anticipation of) death.

Estate planning.

○ The legal entity that holds title to assets after the owner dies and before the property is distributed.

Estate.

○ A personal representative chosen by the decedent to carry out the terms of the will.

Executor or executrix. An executrix is a female executor.

○ Someone who creates a trust.

Grantor or settlor.

○ Technically, the term _______refers to someone who inherits from a decedent who died

Heir.

the owner makes a lump-sum payment now but receives no income until some later date

In a deferred annuity contract,

, the patient can be treated only by doctors in the organization unless there is some extraordinary need for an outside specialist this is in

In health maintenance organizations, known as HMOs

○ A contract in which one person, in return for a fee, agrees to guarantee another against loss caused by a specific type of danger

Insurance.

○ The person whose loss is the subject of the insurance policy

Insured.

○ The person who issues the insurance policy and serves as guarantor

Insurer.

○ . To die without a will.

Intestate

○ . A person's direct descendants, such as children and grandchildren

Issue

A testator must comply with the legal requirements for executing a will:

It must be in writing. The testator must sign it or direct someone else to sign it for him, if he is too weak. Generally, two witnesses must also sign the will. Under the UPC, a notarized will does not require any witnesses, but only a few states have passed this amendment. No one named in a will should also serve as a witness because, in many states, a witness may not inherit under a will.

As with any contract, the grantor must be of legal age and sound mind.

Legal capacity.

There are four requirements for establishing a trust:

Legal capacity. Trustee Beneficiary Trust property

Reimburses the insured for any liability she incurs by accidentally harming someone else

Liability insurance

Generally speaking, a person may leave his assets to whomever he wants. However, the testatrix must be:

Of legal age Of sound mind Acting without undue influence.

A trust ends upon the occurrence of any of these events:

On the date indicated by the grantor. If the trust is revocable, when revoked by the grantor. Even if the trust is irrevocable, the grantor and all the beneficiaries can agree to revoke it. When the purpose of the trust has been fulfilled. If the grantor established the trust to pay college tuition for his grandchildren, the trust ends when the last grandchild graduates.

○ The person who enters into the insurance contract and pays the premiums

Owner.

Each heir receives the same amount

Per capita

Each branch of the family receives an equal share

Per stirpes

○ An individual, corporation, partnership, or any other legal entity

Person.

○ The consideration that the owner pays under the policy

Premium.

○ The process of carrying out the terms of a will.

Probate.

(also known as casualty insurance) covers physical damage to real estate, personal property (boats, furnishings), or inventory from causes such as fire, smoke, lightning, wind, riot, vandalism, or theft.

Property insurance

A trust must end within 21 years of the death of some named person who was alive when the trust was created.

Rule against Perpetuities

he rules on the inheritance of digital assets are based on:

Service provider policies Federal Statutes. Federal Statutes. Court decisions

is the simplest, cheapest life insurance option. It is purchased for a specific period

Term Insurance

○ . Someone who has signed a valid will.

Testator or testatrix Testatrix is the female version (from the Latin).

The grantor must appoint at least one trustee (who may be the grantor himself). The trust __________ end if the appointed trustee dies or resigns. Either the trust instrument provides for successor trustees or a court can appoint one.

Trustee. , does not

insurance is a flexible combination of whole life and term. The owner can adjust the premiums over the life of the policy and also adjust the allocation of the premiums between insurance and savings.

Universal life

Whole life (also called straight life) insurance is designed to cover the insured for his entire life.

Whole Life Insurance

under the Uniform Anatomical Gift Act (UAGA), by putting a provision in your will or by signing an organ donation card in the presence of two witnesses, by using a smartphone app such as DonateLives or Organ Donor ECard, or, in some states, by signing up when you apply for or renew a driver's license.

You can register to be an organ donor:

A short document acknowledging receipt of an application and premium for an insurance policy. It indicates that a policy is temporarily in effect.

binder

the law presumes that a pretermitted child was omitted by accident unless the parent

clearly indicates in the will that he has omitted the child on purpose

When an insurance company violates the covenant of good faith and fair dealing, it becomes liable for both ________________________ damages

compensatory and punitive

The purchaser of a policy makes an offer by

delivering an application and a premium to the insurer.

Creditors cannot reach the assets that a donor has placed in a DAPT

domestic asset protection trusts (DAPTs)

a ___________________ is valid even if the principal can no longer make decisions for herself.

durable power

The major disadvantage of a trust is.

expense

The executor (or the administrator) has a_________ duty to the estate and is potentially liable to the heirs for any mistakes

fiduciary

In carrying out the terms of the trust, the trustees have a ______________ to the beneficiary. This duty includes:

fiduciary duty , A duty of loyalty. , A duty of care.

The percentage of a decedent's estate that a spouse is entitled to claim, regardless of the will's content

forced share or statutory share

An insurance company can violate the covenant of good faith and fair dealing by:

fraudulently inducing someone to buy a policy, refusing to pay a valid claim, or refusing to accept a reasonable settlement offer that has been made to an insured.

Insurance policies often contain a covenant of

good faith and fair dealing.

A holographic will must be in a testator's own___________ —it cannot be

handwriting , typed or written by someone else.

A person has an insurable interest if she would be

harmed by the danger that she has insured against.

A will that is handwritten and signed by the testator, but not witnessed

holographic will

An ______________ becomes effective when signed

immediate power

An insurance contract is not valid unless the owner has an ___________________in the subject matter of the policy

insurable interest

In drafting a will, lawyers use the term__________ instead of children.

issue

A will does not control the distribution of

joint property, retirement benefits, or life insurance

When someone dies intestate, the_________ steps in and determines how to distribute the decedent's propert

law

Insurers have the right to void a policy if, during the application process, the insured

makes a material misstatement or conceals a material fact.

Business liability policies may also protect against other sorts of claims: such as

malpractice Product liability Employment practices liability insurance

The grantor________ transfer specific assets to the trust, although these assets can be nominal. A grantor might, for instance, establish a trust with $10 and then add other assets later.

must

The insurable interest can be ______________ the actual amount of loss suffered.

no greater than

A trust must have specific beneficiaries, although it need___________ list them by name. It can instead list a class, such as "living children of the grantors."

not

Parents are____________ required to leave assets to their children. They may

not, disinherit their children for any reason

Privacy. A will is filed in probate court and becomes a matter of

of public record.

An insurance policy must meet all the common law requirements for a contract. There must be an

offer, acceptance, and consideration. , capacity; Fraud, duress, and undue influence invlaidate the contract

In community property states, a spouse can____________________ marital property acquired during the marriage, except property that the testator_________________________

override the will and claim one-half of all , inherited or received as a gift.

In most non-community property states, a spouse can

override the will and claim some percentage of the decedent's estate (which varies by state)

The trustee technically_________ the property, but she must use it for the good of the_____________ the trustee holds______ title, while the beneficiary holds__________ title

owns, beneficiary, legal, equitable

The will must also indicate whether issue are to inherit

per stirpes or per capita

insurance contracts need not be in writing because the Statute of Frauds does not apply to any contract that can be

performed within one year,

Trusts that last forever

perpetual or dynasty trusts

When a doctor prescribes a lethal dose of medication for use by a terminal patient who is suffering intolerably

physician-assisted death or assisted suicide

A _____________ is a document that permits the attorney-in-fact to act for the principal

power of attorney

A child who is left nothing under the parent's will

pretermitted child

A testator can generally revoke or alter a will at any time

prior to death.

Both the executor and the administrator are entitled to ______________—typically between 1 and 5 percent of the estate's value

reasonable compensation

A trust that can be terminated or changed at any time

revocable

unless a decedent has affirmatively indicated her desire not to be a donor, family members have the

right to make a gift of her organs after death.

If a pretermitted child is left out by accident, she is generally entitled to the

same share she would have received if her parent had died intestate

Traditional health insurance plans are pay for

service

Business partners, employers, and employees have an insurable interest in each other if they would suffer ___________________ from the death of the insured.

some financial harm

A person always has an insurable interest in his own life and the life of his

spouse or fiancée.

a ________________ is effective at some time in the future, typically when the principal becomes incompetent and is no longer able to manage his affairs.

springing power

A trust that goes into effect when a grantor dies

testamentary trust

For a nuncupative will to be valid__________: it is only for for

the testatrix must know she is dying, there must be two witnesses, and these witnesses must know that they are listening to her will. personal property but not for real estate

Estate planning has two primary goals:

to ensure that property is distributed as the owner desires and to minimize estate taxes.

An entity that separates the legal and beneficial ownership of assets

trust

Under the Affordable Care Act, the government is encouraging what it calls

value-based care

A ______ is a legal document that disposes of the testator's property after death

will

The insurance can accept by oral notice, by

written notice, or by delivery of the policy. It also has a fourth option—a written binder.