Does Your Pet Need Life Insurance?
I spoke with a client recently regarding estate planning for her pets and she asked about life insurance for her cats.
We have found that some companies will provide life insurance coverage for your pet, including VPI Pet Insurance, PetPlan Pet Insurance, PetCare Insurance, National Insurance Company and the Oriental Insurance Company Limited.
Benefits can range from $200 to $750 for non-show pets, while higher limits of $1,000 to $10,000 are available.
I am not sure if the plans are a good value, but the insurance may be worthwhile to some pet owners.
If you have any interest in these policies for your pets, be smart, shop around, compare policies and companies, and then decide if it is right for you.
Pet Health Insurance Is Part of Estate Planning For Your Pets
One question that I constantly receive concerns pet health insurance.
I have stated on many occasions that I have no opinion either way, although I personally do not have any pet heath insurance for our dog, Anna.
There are numerous plans for you to review and compare as to coverage and rates.
This site is a good place to begin your inquiries.
Let me know what you decide.
Massachusetts May Be Next To Adopt Statutory Pet Trust
Massachusetts is in line to become the next state to enact a statutory pet trusts.
Presented in 2009, House Bill No. 1467 is entitled An Act Relative to trusts for the care of animals:
SECTION 1. Notwithstanding any general or special law or regulation to the contrary, Chapter 203 of the General Laws, as appearing in the 2006 Official Edition, is hereby amended by inserting after section 3B the following section: -Section 3C.A trust for the care of one or more animals alive during the settlor's lifetime is valid. Unless the trust instrument provides for an earlier termination, the trust terminates upon the death of the animal or, if the trust was created to provide for the care of more than one animal alive during the settlor's lifetime, upon the death of the last surviving animal.
(a) Except as expressly provided otherwise in the trust instrument, no portion of the principal or income may be converted to the use of the trustee, other than reasonable trustee fees and expenses of administration, or to any use other than for the benefit of a covered animal or animals.
(b) A court may reduce the amount of property held by the trust if it that amount substantially exceeds the amount required for the intended use and the court finds that there will be no
Substantial adverse impact in the care, maintenance, health, or appearance of the animal or animals. The amount of the reduction shall pass as unexpended trust property in accordance with paragraph (c) of this Section.
(c) Upon reduction or termination, the trustee shall transfer the unexpended trust property in the following order:
(1) As directed in the trust instrument;
(2) To the settler, if living;
(3) If the trust was created in a no residuary clause in the transferor's will or in a codicil to the transferor's will, under the residuary clause in the transferor's will; or(4) To the settlor's heirs in accordance with G.L. c. 190.
(d) If a trustee is not designated by the trust instrument or no designated trustee is willing or able to serve, the court shall name a trustee. The court may order the transfer of the property to another trustee if the transfer is necessary to ensure that the intended use is carried out. The court may also make other orders and determinations as are advisable to carry out the intent of the settlor and the intended use of the trust.
(e) The intended use of the principal or income may be enforced by an individual designated for that purpose in the trust instrument, by the person having custody of an animal for which care is provided by the trust instrument, by a remainder beneficiary, or by an individual appointed by a court upon application to it by an individual or charitable organization.
(f) The settlor or other custodian of an animal for whose benefit the trust was created may transfer custody of the animal to the trustee at or subsequent to the creation of the trust.
(g) Any trust created under this Section shall be exempt from G.L. c. 184A and the common law rule against perpetuities.
If it becomes law, it will be the 45th state, along with the District of Columbia to have pet trust legislation.
Georgia Enacts Pet Trust Legislation
Welcome Georgia!
Georgia became the forty-fourth state to officially recognize pet trust legislation.
Effective July 1, 2010, a new Revised Georgia Trust Code contains the following clause:
53-12-28.
(a) A trust may be created to provide for the care of an animal that is alive during the settlor's lifetime. The trust shall terminate upon the death of such animal or, if the trust was created to provide for the care of more than one animal alive during the settlor's lifetime, upon the death of the last surviving animal.
(b) A trust authorized by this Code section may be enforced by a person appointed in the trust instrument or, if no person is so appointed, by a person appointed by the court. A person having an interest in the welfare of the animal may request the court to appoint a person to enforce the trust or to remove a person appointed.
(c) Upon termination of a trust authorized by this Code section, the trustee shall transfer any unexpended trust property in the following order:
(1) As directed in the trust instrument;
(2) If the trust was created in a nonresiduary clause in the settlor's will or in a codicil to the settlor's will, under the residuary clause in the settlor's will; and
(3) If no taker is produced by the application of paragraph (1) or (2) of this subsection, to the settlor, if living, and if not, to the settlor's heirs, as determined under Code Section 53-2-1.
Concerned About Choosing A Caregiver for Your Pet Trust?
Pet owners often complain to me that they are not comfortable with picking a friend or family member to be the caregiver for their pets.
Many local Humane Societies are a viable alternative to choosing an individual pet caregiver.
They usually offer a number of programs that include providing care and shelter for the remaining life of your pets.
Some offer to secure a good adopting family for a new home for your pets.
These organizations will require some type of monetary arrangement with your to ensure proper planning. A yearly donation to the Society and then a clause for an additional bequest in your will are normal minimum requests.
If you can afford the financial burden, Humane Societies are excellent choices for the future of your pets, long after you are gone.
Just plan ahead.
Life Insurance Can Fund Your Pet Trust
There is no “one best” way to fund a pet trust.
You may specify a bank account, a savings or money market account, an annuity, an IRA, a payable on death bank account or other form of contractual agreement to fund a pet trust.
Of course, one of the most common forms of funding is through the purchase of a life insurance policy.
Generally, the trustee is named as the beneficiary of the life insurance proceeds to be placed into the pet trust
However, you should consult with your attorney, insurance broker, commodity broker or banker to correctly determine the name that should be placed on these accounts for the benefit of the trustee and your pets.
Pet Trusts Are an Essential Part of Estate Planning For Animal Owners
I am constantly asked about the basic elements of a pet trust.
The trust is a written formal agreement where a trustor (the one writing the trust) places the ownership rights to a specific piece of property or asset under the control of another person, called a Trustee.
The Trustee is to conserve and protect the property on the behalf of someone else, called the beneficiary, who has been designated by the Trustor.
A typical trust will contain provisions for:
(1) The purpose for which the trust was established;
(2) details of the assets placed in the trust;
(3) the powers and limitations of the trustees, including all duties and responsibilities;
(4) form of trustees' compensation; and
(5) conditions and terms that will terminate the trust.
When you are doing estate planning for animal owners, the pet owner is the trustor and the pet is the specific asset to be protected by the trustee.
The trustee provides the funds to take care of the pet.
You also obviously need to appoint a caregiver to physically take care of the pet.
Any remaining monies in the trust after the death of the pet, goes to a secondarily named beneficiary of the trust.
Is Euthanasia a Viable Component of Estate Planning for Animal Owners
The issue of euthanasia for pets continues to bring new and different comments from the readers.
Here is the latest post:
As an owner of an animal, do we have the right legally to euthanize our healthy pet due to a health issue, death, or loss of income.
1) I agree caging a dog that has never been crated is cruel and they can lose sanity within a certain amount of time.
2) Risking that the adopter will be kind and loving is an ongoing torture for the previous owner. 3) Getting lost by the new owner is more mental and emotional torture for the previous owner.
Life doesn't guarantee humans a steady smooth course and sometime we must sacrifice giving away our beloved pets.
My question is as a pet owner do we have the right to put our healthy pet down if we fear for its safety and well being?
What If we feel, no one will love them and care for them the way we did?
After death we know where our pet is and our belief is that they are in a better place and at peace.
I would like to know what other readers feel about this.
Three Million Dollars Left To Fund a Pet Trust-Mansion to Caregiver
Victor Posner was an American businessperson, millionaire and philanthropist who was an original pioneer of the leveraged buyout.
Upon his death, he left a wife and son to survive him.
That wife Gail, has now passed away and left $3 million in a trust to her pet Chihuahua, Conchita and two other dogs.
Her housekeeper will be able to live, rent free, in an $8.3 Million Miami Beach mansion, as long a sheremains the caregiver of the dogs.
She also left some $26 million to house staff and bodyguards.
By the way, she left her son Carl----One million dollars.
Different Type of Pet Trusts Used in Estate Planning for Animal Owners
A pet trust can be established thorough a testamentary trust or with an inter vivos trust.
An inter vivos trust is one that takes place immediately upon the completion and execution of the document. We generally think of this type of trust as a living trust and it is usually revocable by the trust grantor, creator or settlor (all of these terms are used interchangeably).
The living trust can be used to plan for unforeseen circumstances such as incapacity, disability and eventually the death of the grantor.
The grantor also usually serves as the original trustee or co-trustee. In the case where two or more co-trustees serve, the trust instrument can provide that either trustee may act alone on behalf of the trust or require both co-trustees to actor sign.
The trust may never actually be needed or used until the death of the grantor, but it is always available if necessary. It can be changed or altered or even revoked by the grantor at any time.
In a pet trust, this provides that there will be no lapse of care or treatment for your pet and no delay because of any probate process.
On the other hand, a testamentary trust is one that is created in a will.
Since a will is an ambulatory instrument, in that it never is effective until the testator (the one who writes the will) actually dies, this trust will not spring to use until the pet owner is no longer around.
Additionally, a will must go through the probate process, see here, and there may well be some time delays.
This delay may cause issues for the ability of your pet caretaker to secure the means and authority to take care of your pet.
One advantage of this type of trust is that is may be less expensive than the living trust. The trust clauses can be incorporated into the will of the pet owner and thus, become an integral part of the overall estate planning process.
Yet Another View on Pet Euthanasia and Estate Planning for Animal Owners
Another response on the continuing issue of euthanasia for your pets follows from a regular reader.
"Your reader's concern for preserving the life of a healthy pet when he is gone is laudable.
It is not realistic, though, to push that responsibility on to others without providing them with the means to do so.
Whether through a pet trust or informal arrangements of the sort the read describes,chosen cargivers must be provided with the financial resources to insure the pet's proper care."
Send us your thought son this issue.
A Reader's Thoughts on Pet Euthanasia and Estate Planning
I have written extensively on the various views on euthanasia for pets.
I recently received this email from one of our readers in response to a previous posting by another reader.
I can't possibly condone euthanizing perfectly healthy animals just because I'm no longer around. I would think it best to plan for your companion animals as follows: (1) Name individual(s) who can have the first option of whether to take your animals when you die; or (2) If there is no such individual, look to the place that you got your pet. Any breeder, rescue or shelter worth a lick should have had a contract stating that they would take the animal back (and should be given the opportunity to OK the individual who you name in option #1); or (3) If that fails, look to the local shelter -- or rescue if you are not satisfied with your local shelter.
The reader's blanket statements just don't hold up. First, I do not understand the statement that cruel people adopt from shelters. Many, many wonderful folks adopt many, many wonderful animals from shelters every year. Second, there are so many incredible rescue organizations out there, many of which are foster only, with no cages at all. For that matter, more and more local shelters are also setting up foster programs.
Don't get me wrong -- I believe euthanasia has its time and place. It just seems incredibly egotistical to me to think that an animal shouldn't go on because I'm no longer around. I guess I have more faith in people, shelters and rescues than this particular reader.
Your thoughts or response?
New York Improves Pet Trust Laws
In 1996, the New York legislature enacted a law to allow for the creation of trusts for pets.
However, that statute had a twenty-five year limitation for the duration of the trust.
Governor David A Patterson recently signed a new amendment to the older legislation.
New York has now joined the majority of states that recognize the longer time duration for the pet trust and conforms to the Uniform Trust and Probate Codes.
The trust may now last for the entire lifetime of the pet, without a yearly limitation.
In addition, the statute is titled "Trusts for Pets" instead of "Honorary Trusts for Pets", as honorary means unenforceable and pet trusts are presently enforceable under subparagraph (a) of the statute.
State pet trust legislation continue to evolve.
Oklahoma Is The Newest State To Allow Statutory Pet Trust
Oklahoma has become the latest state to allow for a statutory pet trust.
Governor Brad Henry recently signed House Bill1641 into law.
The law creates a new section of law that validates trusts for the care of designated pets. Unless the trust stipulates, the trust is terminated when no living animal is covered. The bill outlines the rules governing such trusts, including compensation for the trustee, accounting requirements and provisions for terminating the trust.
The measure describes how trusts for pets works, and how the issue is resolved if there is no living pets. It provides for trustee compensation and the naming of such if no trustee is designated. Any trust that does not have a value of $20,000 or more is exempt from fees, except as directed by a court or the trust instrument.
The law becomes effective in approximately three months.
Good job by the Oklahoma legislature to get on board with a majority of the states that recognize pet trusts.
Use a Charitable Remainder Trust in Your Estate Planning For Your Pets
Can I use a charitable remainder trust in my estate planning for my four dogs?
Ron Troy, Ohio
Ron, with a charitable remainder trust, you set up a trust and transfer to it the property you want to donate to a charity.
The charity needs to have a tax-exempt status under the Internal Revenue Code and must be fully accepted and approved by the IRS.
The charity serves as trustee of the trust, and manages or invests the property so it will produce income for you
The charity then pays to your Trustee of your pet trust, a portion of the income generated for a certain number of years, or for the duration of your pet trust.
When the trust ends, the remainder of the property goes to the charity.
There can be some beneficial tax treatment and this is a very popular type of trust.
Consult your attorney and your accountant before you begin this process.
Now Is The Time To Plan For Your Pet's Future
Many studies support the proposition that your pets are good for you, not only emotionally, but also physically, as well.
Dr. Deborah Wells, a psychologist from Queen's University, Belfast, said dog owners tended to have lower blood pressure and cholesterol and in general, tend to be healthier than most other individuals.
According to the website www.pethacker.com, the research of Dr. Wells suggested that dog ownership produced more positive influence than cat ownership and that dogs could aid recovery from serious illnesses such as heart attacks, and act as 'early warning' to detect an approaching epileptic seizure.
Go here, to read the rest of the article.
Your pets can aid you in your lifestyle, you need to properly plan for their future, with or without you.
Do Not Forget To Revise Your Estate Plan If You Adopt A Pet
We would like to adopt a dog into our family home. I have heard that there is an application that usually is required for this procedure. Can you tell me about this?
Cathy Estero, Florida
Cathy, most agencies, either private or public require an application and review of the prospective adoptive pet parents.
For example, Southern California Giant Schnauzer Rescue is a group of dog rescuers who have banded together to help Giant Schnauzers find their forever homes.
The founder is virtual assistant, paralegal and animal lover Karalyn Eckerle of California.
They define their Forever Home as,” a home where he is loved, respected and well cared for -- a home where this intelligent working dog can love, protect and call his own.
Go to their website here, and download a copy of the adoption application.
It is a good example of the type of information that most agencies will request and require during the adoption period.
Good for you; to even consider adopting a pet.
Remember Estate Planning To Include Your Horses
I recently found this interesting post here.
Check out the site for your self…
"I put this in horse care because it's about caring for your horses.
After you die.
My friend just died.
Intestate (no will or trust)
She left no instructions for anyone.
She has a barn full of horses - some of whom are old.
I don't know what happens to us after we die, but I do know what happens to our family and friends. I saw it in my work - every day. And I see it now even though I'm retired.
They have to make decisions when they're grieving and in shock. They may be angry, confused, bereft. Often, they argue over what they think you'd want for your animals. Sometimes your animals are not considered at all - and merely hauled off.
Please don't do that do your loved ones, and don't let your horses or pets become embroiled in a tug of war. Or worse - be taken to auction or the shelter.
Please consult a licensed attorney and have your will or trust prepared.
Educate yourself on the basics of estate planning, how life insurance or other contracts pass to beneficiaries - and have your estate in order.
Review it annually or when a major event occurs (birth, death, divorce, change in other circumstances)
Please don't leave this earth without providing for your loved ones - including your animals.
You are all loved, and will be missed by someone.
And that someone is standing out in the pasture, or napping on your bed...."
Good thoughts for all animal lovers.
Use Trusted Professionals for Your Pet Trust
I want to provide the necessary estate planning after I am gone, for my Cat, Casey. I recently saw that Legalzoom.com offers online pet trusts. Would one of these trusts be adequate to protect Casey?
Cyndi Bonita Springs, Florida
I certainly cannot speak to the quality of any Legalzoom.com document or its preparation or accuracy.
I have never used the service.
I did visit the site however and read an article by a Tiffany Knight.
Part of the article reads, “But one word of caution: laws concerning pet trusts differ from state to state. Specific legal language is required to establish an enforceable trust for a pet's care. The following 19 states have adopted specific language on animal trusts: Alaska, Arizona, California, Colorado, Florida, Iowa, Kansas, Michigan, Missouri, Montana, Nevada, New Jersey, New Mexico, New York, North Carolina, Oregon, Tennessee, Utah and Washington.”
On the other hand, Professor Gerry Professor Beyer who is on the faculty of the Texas Tech University School of Law, as the Governor Preston E. Smith Regents Professor of Law, and one of the experts in estate planning for pet owners notes that some 43 states and the District of Columbia have some form of statutory pet trust.
I would personally put my faith and trust in the writings of Professor Beyer when considering the use of their service.
But, that is simply my opinion.
Continuing Education for Professionals
Many of our active readers are also avid supporters of their local Humane Society or other similar community organization.
They support these facilities with their time and their money.
In addition to providing care and medicine for local animals, a vital part of the many programs of the various entities is education.
This applies not only to the public, but also to the professional groups, such as attorneys, financial planners and estate planners.
I have been working with the Humane Society of Naples to assist in the education process of pet trusts and estate planning for pet owners, to present to the public and the professionals.
To that end, we have been successful in preparing a Continuing Legal Education program that has received approval by the Florida Bar. The program is entitled Estate Planning For Animal Owners.
If you believe that your organization could benefit from a similar program, I will do whatever I can to assist.
Have your organization’s representative contact me directly.
This could be a long range planning strategy that benefits your pet community.
No Pet Trust In Delaware?
Although pet lovers in Delaware have been trying for over five years, the legislature has consistently failed to pass a Statutory Pet Trust in that jurisdiction.
Nevertheless, pet owners in Delaware are not out of options in the event that they want to provide estate planning for their pets.
Professor Gerry W. Beyer is a faculty member of the Texas Tech University School of Law. Professor Beyer is an invaluable source and resource for all involved in the field of estate planning for animal owners. His website is full of updated information regarding this area.
A prolific author and public speaker, Dr. Beyer writes that the “traditional pet trust” is effective in all states, even those without the Statutory Pet Trust.
According to Professor Beyer,” Many pet owners will prefer the traditional pet trust because it provides the pet owner with the ability to have tremendous control over the pet’s care. For example, you may specify who manages the property (the trustee), the pet’s caregiver (the beneficiary), what type of expenses relating to the pet the trustee will pay, the type of care the animal will receive, what happens if the beneficiary can no longer care for the animal, and the disposition of the pet after the pet dies.”
If you live in a state that has not authorized a specific Statutory Pet Trust, you can still plan to provide for the care of your pets with the preparation of the correct legal documents. There are alternate methods that will be accepted and approved by the courts.
