Who Is a Designated Beneficiary?
A designated beneficiary is a person who has been named to inherit an asset.
You are the beneficiary for any approved optional spousal life coverage.
You should designate a beneficiary for your life insurance to avoid it being paid to your estate. If your estate is your beneficiary (either by designate or default), the life insurance will form part of your estate and be distributed in according to the terms of your will. The insurance proceeds will not be accessible until the Will has been probated by the courts and are subject to estate taxes.
When naming a beneficiary, it is important to consider the legal implications of your decision.
- If you name your spouse, or another relative, friend or charitable organization, the insurance monies will be paid directly to them if they are of legal age (18 years).
- If the named beneficiary is under legal age at the time of your death, proceeds will be held in trust by the Province of Ontario and the money, plus accrued interest, will be paid out when the beneficiary reaches 18 years. To avoid the additional administrative costs for this service and to ensure the monies are available in a timely manner, you should consider naming a trustee for the funds
- You may wish to name a contingent beneficiary. This is the person(s) who will receive the insurance monies should your named beneficiary predeceases you or die at the same time as you.
Adding your beneficiary designation
You can assign or change your beneficiary designation in your Workday account. The original, signed paper beneficiary designation form must be mailed to, or dropped off at, Human Resources, located at East Campus 1. The change will take effect once received and processed in Workday.
The following supporting guides may help you (WatIAM required).
Please Note: If you elect to designate someone in addition to, or in place of, your spouse as your pension beneficiary, we require a completed pre-retirement waiver form (PDF), signed by both you and your spouse.
The following as some examples of selecting beneficiary designation:
| Employee's intention | Sample wording |
|---|---|
|
Wish to name two people in equal shares |
John Doe, my spouse, and Jane Doe, my sister, in equal shares. |
|
Wish to name a trustee for two minors (under age of 18 years) |
John Doe, in trust for my son, James Smith and my daughter Jane Smith, during the years of their minority in equal shares. Note: you may wish to specify another age where the proceeds would be held by your Trustee, e.g. "while they are under the age of 21 years." |
|
Wish to name a contingent beneficiary |
If John Doe predeceases me, benefits should be paid to my son, James Smith and my daughter Jane Smith in equal shares. |
|
Wish to designate a flat amount1 to one beneficiary and the excess amount in equal shares |
John Doe, my spouse in the amount of $150,000, my son Charlie and daughter Sara the remaining amount in equal shares. |
1 ;flat amount: meaning you assign a specific and unchanging dollar value from your life insurance to a beneficiary following your death.
When Coverage Ends
If you continue working past the end of the year you turn age 69, your life insurance coverage reduces to the retiree life insurance benefit, with the premium paid by the University. Employees who resign from the University after age 55 with 10 or more years of continuous service in a permanent position and who elect an immediate pension option, qualify for the retiree life insurance ($6,300 flat amount as of January 1, 2023). Eligibility for post-retirement benefits is under review by the Pension and Benefits Committee, and it is strongly advised that employees discuss eligibility for post-retirement benefits with Human Resources before completing the retirement intention on Workday. If an employee elects a deferred pension, eligibility for the retiree life benefit is forfeited.
Employees are eligible to convert all or a portion of their life insurance amount through Sun Life Financial within 31 days of coverage loss either due to age (i.e. reduction at age 69) or due to employment ending. The advantage of exercising this conversion option is that medical evidence of insurability is not required.
Employees who are interested in this option can obtain the necessary forms by contacting HRHelp at hrhelp@uwaterloo.ca or by stopping by our office, located at East Campus 1.