Health and Life Insurance

Answer: C - The IRS states that the value of life insurance proceeds will be included in the insured's gross estate if the policy proceeds are payable to the insured's estate, in either a direct or indirect fashion. The proceeds may also be included in the insured's estate if such benefit proceeds are paid to a named beneficiary or beneficiaries, and/or if the insured possessed an ownership interest in the policy at the time of their death. By removing ownership of the policy, the proceeds may be exempt from inclusion in the estate (within certain guidelines).