The trainwreck of a divorce...

[Life Hawk]

Anyone deal with a divorce attempting to collect on a policy after they've been divorced from the ex-spouse that just passed?

Had an interesting claim this week.

 

[DHK]

Whoever is listed as beneficiary gets the funds, whether it's an individual or a trust. Beneficiary designations trump wills.

If there isn't a specific or eligible beneficiary, then it will be included in the probate estate.

 

[Life Hawk]

Well, the company will be taking a little different view. If the divorce papers do not call out this policy and direct it to the primary, then the company says it will distribute funds to the contingents.

 

[DHK]

Based on that, they're going back to the divorce decree... which can make sense. I'm sure the legal team of the company is acting within the law. Hopefully contingent beneficiaries are listed.

I always share this video when anyone has questions regarding beneficiaries.

 

[Life Hawk]

Yes, she is the mother of 3 of the beni's. I discuss this here as a warning to agents that might have policies that fit into this category. Funny addition, she was the payor on this policy. Smart gal for hanging on to it. It is going to be a major win fall for her in the long run.

 

[LostDollar]

As you know I am not an agent. Just curious here.

If making payments means she is the owner of the policy and she had a legitimate insurable interest in the decedent when the policy was issued, how can the courts take the money away from her?

 

[Tahoe Ray]

As you know I am not an agent. Just curious here.

If making payments means she is the owner of the policy and she had a legitimate insurable interest in the decedent when the policy was issued, how can the courts take the money away from her?

Making payments doesn't mean she was the owner. If she is the owner/bene and he's the insured, they can't/won't.

 

[DayTimer]

Anyone deal with a divorce attempting to collect on a policy after they've been divorced from the ex-spouse that just passed?

Had an interesting claim this week.

I have two clients who were ordered by the court to purchase and maintain a specific death benefit of life insurance until the children graduate from college as part of the divorce decree.

As you know I am not an agent. Just curious here.

If making payments means she is the owner of the policy and she had a legitimate insurable interest in the decedent when the policy was issued, how can the courts take the money away from her?

Divorce does not necessarily eliminate one's insurable interest in the life of the former spouse.

 

[DHK]

I have two clients who were ordered by the court to purchase and maintain a specific death benefit of life insurance until the children graduate from college as part of the divorce decree.



Divorce does not necessarily eliminate one's insurable interest in the life of the former spouse.

Insurable interest only needs to be established at the time of application.

 

[bill3173]

Well, the company will be taking a little different view. If the divorce papers do not call out this policy and direct it to the primary, then the company says it will distribute funds to the contingents.

I figured that, I had this same discussion, with the sister of the insured a few weeks ago. The named bene is divorced from her brother, but this policy was not referenced in the divorce decree.

The ex-wife was still paying for the policy, but sister has poa, so I told her to get the ownership transferred, and start paying it herself and change the bene. She asked what I thought was fair, and I told her to pay her ex sil the surrender value of the policy.