Contesting life insurance beneficiary: Can it be done?

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PostPosted: Tue Dec 01, 2009 12:22 pm   Post subject:   

MaxHerr, We've been down this road before. You are wrong. Look at a bunch of insurance applications. Many of them will say exactly what will happen if there is no living named beneficiary.



The insurance company isn't just declaring who will be beneficiary. It is part of the contract and the contract language has been approved by the state.



How can they automatically pay to the estate of the policy owner? If the policy owner is not the insured, and he is still alive, he has no estate!



Look at, for example, a Mass Mutual contract. It will explicitly tell you that if no named beneficiary is alive, the money will get paid to the policy owner if the policy owner is alive and to the policy owner's estate if the policy owner is dead.



Ex. We were business partners. I bought a policy on your life. The business breaks up. We're still friends, and we simply change the beneficiary to your wife. She dies. 6 months later you die. The death benefit will be paid to me.



Other contracts will list the order if there is no living beneficiary (spouse, children, parents, etc.)



Probate law has nothing to do with any of this. Probate only comes into play IF the money gets paid to the estate.



You can't point to any law that forbids the use of default beneficiaries. I can point to insurance contracts that have default beneficiaries.



I hope that you aren't one of those posters who can't admit when they are wrong.


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sajfqaioru
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PostPosted: Tue Dec 01, 2009 1:50 pm   Post subject:   

oh geeeeeeeze here we go again...Max are you any kin to Gary by chance? Wink Just kiddin' there bud...It's very dangerous (IMO) to ever say things like, 'all' 'every' etc...



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Lori
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PostPosted: Tue Dec 01, 2009 6:09 pm   Post subject:   

OK, OK, "sajfqaioru," maybe I misspoke when I wrote "owner's estate" (but life insurance creates an "immediate estate," so technically, it is going to the owner's estate . . . it's really just a matter of semantics). I think we're both on the same side here.



The discussion started or diverted based on a comment that leads me to believe someone thinks insurance companies deliberately try to confiscate a beneficiary's interest, which is not true, through the use of "default" beneficiaries.



I've never seen an individual life contract that specifies anyone other than the owner (or their estate) as the person who receives the death benefit if there is no named beneficiary. (Industrial and group policies have somewhat different "per stirpes" language).



If you don't believe that life insurance is connected to probate law, that a mistake. The language used in most contracts conforms precisely to it so that the contract may escape the hold of the probate court when an insured dies intestate. It's not the insurance company "choosing" a default beneficiary, it is the insurance company following the guidelines of probate and property law.



If the owner is not the insured, and the owner has not named a beneficiary, property rights (interest in the policy) endure to the owner, not because the insurance company came up with the idea, but because it's a settled matter of law. Why do you think ownership passes from the deceased owner to the insured if the owner dies without previously assigning the policy to a new owner (which cannot be done testamentarily through a will or trust)? Because the insured is the only other "party" named in the contract. I guess you could call that the "default owner" provision folr consistency.



Having said this, I am absolutely in full agreement with everything you wrote. Nothing is incorrect except implying that the insurer's wording in the contract is its own independent design rather than being guided by other laws external to the contract.



Your business partner Buy-Sell example is fine, except I think the situation would benefit from a change of ownership rather than a mere change of beneficiary. But as presented, it's entirely correct.



Honestly, I think we're really on the same page here, just a word or two that we may be stumbling over.



And, yes, Lori, generalizations such as "all, none, never, always" are often poor choices of vocabulary.



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PostPosted: Tue Dec 01, 2009 8:00 pm   Post subject:   

Life insurance doesn't create an immediate estate unless the insured is the owner of the policy.



Just because you haven't seen something doesn't mean that it doesn't exist. Start paying attention and you'll see it often.



The issue isn't if the insured dies intestate. It's only an issue if the owner dies intestate.



A life insurance policy is treated like any other asset of the owner and can be passed on via a will.


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PostPosted: Tue Jan 05, 2010 12:59 am   Post subject: Contesting Beneficiary  

My father purchased a life insurance policy back in 1990 at that time I was a minor so he put his sister as beneficiary and me & my brother as contingent. My dad told me he was doing a change of beneficiary back in 2008 and needed my social security#.My dad passed away 10/30/09 so I called the insurance company to let him know about his death. His sister received the check from the insurance company and won't talk to me. The insurance company did admit my dad requested a change of beneficiary and sent him the paperwork 4/11/2008. They said I need to find the form or maybe it got lost when he mailed the form back. His sister admitted she knew the money was not meant for her but has decided I am greedy so she is going to sit on it for awhile. let me add I just found out she has a gambling problem. I live in WA and my dad lived in Iowa. Is this worth fighting for?


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thissucks
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PostPosted: Tue Jun 15, 2010 4:22 pm   Post subject:   

I think you should honor who the deceased chose for their beneficiary. It should be unlawful to contest it. Why can't you accept what they wanted instead of selfishly thinking of yourselves.


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PostPosted: Wed Jun 16, 2010 5:04 am   Post subject:   

Quote:
Is this worth fighting for?




There is nothing to "fight for" (or over). If the money was paid to your aunt, it's her money, regardless of what she and your father may have previously agreed to or what your father told you his "intent" was.



If the insurance company's practice is to require a policyowner to fill out a form to effect a change of beneficiary, if they never received the form, even if "lost in the mail," the only beneficiary they can pay the claim to is the one of record -- unless that person is disqualified by state law (as in a prison inmate, or legally incapable of receiving the money) or has predeceased the insured, neither of which appears to be the case in your situation.



It's your aunt's money, gambling habit or not. If she chooses to share it with you and your brother, that's her decision, not a court's.



This is exactly the reason that if a person intends for life insurance proceeds to go to their children, even if currently minors, the CHILDREN should be named as the beneficiaries. In addition to this, a will or trust will need to be created to provide instructions as to who or what will receive the money FOR THE BENEFIT OF THE CHILDREN.



It is inappropriate to name any other person (other than a life insurance trust) to receive the proceeds with the expectation they will be used for the children (or given to them when they become adults).


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PostPosted: Wed Sep 01, 2010 11:30 pm   Post subject:   

My father had me and my step mom both as 50/50 beneficiaries on his life insurance policy. She talked him into (or she changed it cause she had power of attorney) changing it to 100 for her 3-4 months before he died. My father had brain cancer and wasn't of sound mind? Can I go after my step mom even after she's already been paid by the insurance company? And how long do I have to file a claim?


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PostPosted: Thu Sep 02, 2010 3:53 am   Post subject:   

Quote:
She talked him into (or she changed it cause she had power of attorney) changing it to 100 for her 3-4 months before he died. My father had brain cancer and wasn't of sound mind?




Power of attorney cannot confer the privilege of ownership on someone other than the actual owner of a life insurance or other policy. If you can document that your father was not of legal capacity to make any change of beneficiary at the time it was actually changed, then you have a valid claim against your stepmom, and there could be a case for forgery or other crime if she managed to get your father's signature on a beneficiary change form or letter.



It's all about the burden of proof. If you have it, great, if you don't . . .


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PostPosted: Sat Dec 18, 2010 1:07 am   Post subject: life inshurance  

My husband of 6 years passed away suddenly on oct 22nd in a ATV accident.He had worked for a company for 28 years and this past year he got hurt on the job and stared a workmans comp case.The accident happend right in the middle of this, but he had been tumanated from this job for 1yr and 3 months so he didnt know he had life inshurance.When he passed I found outh that he had it and the beneficiary was his dad.I know he already has the check and I want to know if there is anything I can do.My husband had no will wich also makes it difficult.Any info can help.


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PostPosted: Sat Dec 18, 2010 4:39 pm   Post subject:   

Unfortunately, a named beneficiary supercedes all other possibilities. Unless that person is willing to share some or all of the proceeds, there is nothing you can do legally to obtain the money.



Perhaps a very visible public campaign denouncing your father-in-law might work.



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PostPosted: Wed Dec 29, 2010 12:38 am   Post subject: Assigning benefuiciaries  

My father just past away. He had been heavily medicated while dieing of cancer and somehow his girlfriend convinced him to marry her. As I settle the estate, of which there is little, to whom does the state of california deem as beneficiaries of bank accounts, car; there is no house. There is no will. Does it all go to her or are we equal beneficiarties?


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PostPosted: Wed Dec 29, 2010 1:24 pm   Post subject:   

Quote:
Does it all go to her or are we equal beneficiarties?




By "we", I assume you mean "the children". Under California law, a legal spouse has a priority claim over that of children. However, under the circumstances, you may possibly be in a position to challenge the marriage. You will need an attorney experienced in probate law.


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PostPosted: Thu Feb 17, 2011 8:55 pm   Post subject: Making a claim on a life insurance policy  

My father recently passed away and I spoke to his life insurance company to inform them of his death. They are sending me claim paperwork, but I am not listed as beneficiary. My exact question is why would they send me the paperwork to make a claim if I am not the beneficiary?


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PostPosted: Fri Feb 18, 2011 5:48 am   Post subject:   

Insurance claim paperwork may be sent to anyone, and anyone may file a claim. The claim will only be paid to the person(s) entitled. If you are not the beneficiary, the claim will be paid to the beneficiary, and if there is no beneficiary, the claim will be paid to the owner of the policy.



Assuming that your father was also the owner (which is true in at least 95% of all individual life insurance policies), if there is no surviving beneficiary, the policy proceeds are payable to your father's estate. As your father's child, you (and your brothers and sisters) may be in line to receive estate proceeds . . . if creditors do not take it all first. If alive, your mother would be ahead of you (and your siblings) as the beneficiary of the estate, but not ahead of any of your father's creditors.



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