How Florida's Statute of Wills Shapes Life‑Insurance Trusts

Statute of Wills Requirements for Life‑Insurance Trusts in Florida

Florida law mandates that a will, including any provision creating a life‑insurance trust, be signed by the testator and witnessed by two disinterested adults, or executed as a holographic will written entirely in the testator's handwriting. The trust language must be clear, and the insurance policy must be properly assigned to the trust before the testator's death to avoid probate.

Key Differences from Other States

Unlike many states that allow a simple "pour‑over" clause, Florida requires the trust to be a distinct legal entity with its own tax identification number before the policy is transferred. The Statute of Wills also imposes a five‑year limitation on contesting a will, which can affect disputes over life‑insurance proceeds.

Funding the Trust Correctly

To ensure the trust receives the policy's death benefit, the owner must change the beneficiary designation to the trust and file a written assignment with the insurer. Failure to complete this step before death may cause the policy to pass to the residuary estate, subject to probate.

Tax and Probate Implications

When funded properly, a Florida life‑insurance trust removes the death benefit from the taxable estate, potentially reducing estate‑tax exposure. Because the trust is a "non‑testamentary" entity, the proceeds are not subject to the probate process, expediting distribution to beneficiaries.

Common Pitfalls and How to Avoid Them

Typical errors include:\u00a0

• Neglecting to update the beneficiary after a trust amendment.
• Using a non‑Florida‑compliant will form.
• Failing to obtain a signed, witnessed assignment from the insurer.

Address these early with an estate‑planning attorney familiar with Florida's statutes.

Sample Comparison Table