by ramirez2work » Sun Oct 02, 2011 06:34 am
My mother and father have been devorced for over five years. in the divorce she was never granted my fathers life insurance. My father passed never changing the beneficaries which named her as primary and me as secondary and i am also executor of his estate. and he left behind six children and we all want to dispute so she does not get a pay out but instead get ditributed evenly between his six children. can this be done. (we are it the state of Arizona)
Posted: Fri Oct 07, 2011 11:34 am Post Subject:
Hi,
In Arizona, I think a divorce revokes the beneficiary designation. So, your mother will not be able to receive the policy proceeds.
Posted: Tue Oct 11, 2011 05:33 am Post Subject:
While there is statute in the state of Arizona, that revokes beneficiary designations for a spouse post divorce, it is not advisable to depend on that.
As your father never changed the beneficiaries you may have to negotiate with the insurer and find out if they are going to revoke your mother's beneficiary status or not.
This might also require you to contest the case with the help of an attorney. But this would involve in sharing a part of the proceeds with the attorney himself.
Posted: Wed Oct 12, 2011 11:23 am Post Subject:
it is not advisable to depend on that.
Really? You can't be serious. What you have said, in effect, is "Oh, the law? Don't worry, nobody goes by the law. It's not important at all."
As your father never changed the beneficiaries you may have to negotiate with the insurer and find out if they are going to revoke your mother's beneficiary status or not.
If a divorced spouse's interest is revoked according to the operation of insurance or probate law, the insurance company cannot "negotiate", it must abide by the law. So must the ex-spouse. If the insurance company pays the proceeds inadvertently to the ex-spouse, the ex-spouse is supposed to pay an equivalent amount to the estate of the deceased former spouse, or to the contingent beneficiary if there was one. (And there is no legal recourse against the insurance company for paying money to the wrong person.)
To the OP, the question that needs a definitive answer is: Following the divorce, did the ex-husband rename the ex-wife as the beneficiary? That's an entirely different matter, and it is enforceable. If there was no renaming of the beneficiary, the revocation (defined under probate law) will likely stand, unless there is specific mention of it in the divorce decree, and the money will be payable to the contingent beneficiary if there was one, otherwise it is payable to the decedent's estate.
If the money is payable to you, and you choose to give some of it to your siblings, although the money paid to you will be income tax-free, what you give to your siblings will be considered a "gift" under the tax code and if any gift exceeds $13,000, it can create a gift tax liability for you.
So, consult the divorce order and then the Arizona Probate Code (14-2804. Termination of marriage; effect; revocation of probate and nonprobate transfers; federal law; definitions) for more information. It uses the term "governing instrument", which should include "insurance contract' under that catch-all phrase. Life insurance proceeds are a "nonprobate transfer'.
Posted: Wed Oct 12, 2011 10:58 pm Post Subject:
A lawyer is required because someone didn't do what they should have done in the first place. You already lose.
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