Yes, a life insurance policy can name the policyholder as the beneficiary, but the payout will go to the policyholder's estate rather than directly to a living person. This means the death benefit is subject to probate and may be taxed according to estate rules.
More from this site
Keep reading the latest coverage
Why a Policyholder Might Choose Themselves as Beneficiary
Some owners use this setup to keep control over the funds, allowing them to decide later who receives the money or to use it for specific purposes like debt repayment or business succession.
How the Benefit Is Distributed
When the insured dies, the insurer pays the death benefit to the estate's executor, who then follows the will or state intestacy laws. The funds become part of the estate's assets and are handled like any other inheritance.
Tax and Probate Considerations
Because the benefit passes through the estate, it may be subject to estate tax if the total estate exceeds exemption limits. Additionally, probate can delay access to the funds, sometimes taking months.
Alternatives to Self‑Beneficiary Designation
Most policyholders name a spouse, child, trust, or charitable organization directly to avoid probate and reduce tax exposure. A revocable living trust can also hold the policy, providing control while keeping the payout outside the estate.
When It Makes Sense
Self‑beneficiary designations are useful for temporary situations, such as when the ultimate recipient is not yet known or when the policy funds are intended for a specific future purpose that the policyholder wants to manage.