is a life insurance product falls under category of a real estate property, please guide.
Life insurance does not fall under Real Estate property. It is personal property, and depending on the type of life insurance ie term or cash value, it is looked at as a liability or an asset when it comes to your personal or business finances. Term is considered a liability because there is no equity that is buildt into the policy like with cash value where the cash value account is found in the other assets heading of you personal/business ballance sheet. It sounds as if your question is a little deeper than how the life insurance is regarded in terms of property, are wondering about this for estate planning reasons? If so when using life insurance for estate planning purposes it is extreamly important that you work with someone who has the knowledge and experiance to use life insurance, the proper way to title and how the estate tax system works. It can be quite complicated, but with the right life underwriter and estate planner it can be made very simple.
It is personal property, an asset not Real Property.
No, real estate is land, or buildings ON land. Life insurance is a CONTRACT. Life insurance PROCEDES are also not real estate.
Life insurance policy is something that will benefit somebody if and when the holder of the policy dies. Their is always a beneficiary in a life insurance policy. Mostly, husbands , wives, sons and daughters or even pets are made beneficiaries. Whereas, a real estate property is a piece of land that can be owned by one or more where no beneficiary is stated unless the owners make a will naming an heir to such property. Definitely the two are different and do not fall in the same category.
No, life insurance is not real estate property. At the point of sale Life Insurance is considered as intangible and it only a contractual agreement between a policy holder and insurance company. Whereas real estate property is tangible. Life Insurance company will promise to pay the beneficiaries in the event of death/disability of the life asured. But life insurance is very useful in estate planning and wealth distribution. It can helps to payoff estate duty and make sure the next generation still can keep the real estate and not taken by the government in the event of death.
