Can Spousal Rights Override Beneficiary Designations? There is no short answer to this question. It all depends on the type of the life insurance policy, the state where it was issued, the state where the couple lived, and the way the premiums were paid.
Generally, no. But exceptions exist
Typically, a spouse who has not been named a beneficiary of an individual retirement account (IRA) is not entitled to receive, or inherit, the assets when the account owner dies.
If you're wondering, “Can my spouse change the beneficiary on my policy?,” the answer is no, in most cases. For your protection, most insurance companies will only let the owner of the policy grant a beneficiary change so that a spouse (or ex-spouse) can't make any changes on a whim.
Your life insurance payout may automatically go to your spouse — regardless of whether you name a beneficiary — if you live in a community property state, which considers you and your spouse equal owners of all your joint assets.
The beneficiaries designated in your life insurance policy can be disputed in court after you pass away. These conflicts usually happen when you fail to properly update your beneficiaries after major life events like marriage, divorce, and having or adopting children.
To contest a life insurance beneficiary, a person must file a lawsuit or other legal documents with the probate court handling the deceased person's estate. The insurance company won't disburse funds while the case is pending.
Generally speaking, in order to contest a beneficiary designation, the individual must have a valid legal claim to do so. ... In order to challenge a beneficiary designation, the claimant must be able to prove that the designation does not accurately reflect the decedent's wishes.
The policy owner is generally the only person who can change the beneficiary designation. If you have an irrevocable beneficiary or live in a community property state you may need approval to make policy changes. A power of attorney can give someone else the ability to change your beneficiaries.
Can a Power of Attorney Change a Life Insurance Beneficiary? Yes — but the agent always has a fiduciary duty to act in good faith. If your power of attorney is making such a change, it must be in your best interests.
Can a Beneficiary Be Changed After Death? A beneficiary cannot be changed after the death of an insured. When the insured dies, the interest in the life insurance proceeds immediately transfers to the primary beneficiary named on the policy and only that designated person has the right to collect the funds.
Beneficiary Designation Takes Precedence Over A Will
A beneficiary designation supersedes a will. ... This means that if you get divorced and remarry, but do not update your beneficiaries, your former spouse is the legal heir to those accounts if you named him the beneficiary while you were married.
Wills do not override beneficiary designations; rather, beneficiary designations ordinarily take precedence over wills.
If you're wondering whether an executor can override a beneficiary, you're asking the wrong question. An executor can't override what's in a Will. If you're a beneficiary mentioned in someone's Will, the executor can't cut you from the Will after the testator has died. You still have rights to the estate as written.
When a POA is a general POA, if there's nothing in it, giving the agent the right to change bank account beneficiaries, the agent cannot do so. Even if the agent can deposit checks in the bank, changing beneficiaries of a bank account is a special power which the POA instrument must specifically list.
Many life insurance companies try to contact beneficiaries if the beneficiaries don't contact them first. ... Many states require insurance companies to check the Social Security “Master Death File” for deceased policy holders and to try to notify their beneficiaries when they find a policyholder on that list.
Beneficiaries have the right to know they have been designated as recipients on a life insurance policy and have the right to collect the proceeds even if the insurer failed to inform them in a timely manner.
When can a policyowner change a revocable beneficiary? With a revocable beneficiary designation, the policyowner may change the beneficiary at any time without notifying or getting permission from the beneficiary.
For example, a spouse who is an irrevocable beneficiary has the right to a policy payout even after a divorce. The ex-spouse must agree to changes in the policy before or after the death of the insured. Even the insured cannot change the status of an irrevocable beneficiary once they are named.
An executor can override a beneficiary if they need to do so to follow the terms of the will. Executors are legally required to distribute estate assets according to what the will says.
Generally, a beneficiary designation will override the trust provisions. There are situations, however, in which the beneficiary designation will fail and the proceeds of the account will pass under the terms of the trust.
In case the beneficiary is deceased, the insurance company will look for primary co-beneficiaries whether they are next of kin or not. In the absence of primary co-beneficiaries, secondary beneficiaries will receive the proceeds. If there are no living beneficiaries the proceeds will go to the estate of the insured.
If an insurer contests a life insurance claim, they will deny or reduce the death benefit paid out to your beneficiaries and provide a detailed explanation as to why the claim was contested.
Effect of Marriage on estate plans:
Under California law, a marriage automatically invalidates any pre-existing will or trust as to the new spouse's inheritance rights, unless the documents provide for a new spouse, or clearly indicate a new spouse will receive nothing.
As long as the executor is performing their duties, they are not withholding money from a beneficiary, even if they are not yet ready to distribute the assets.
As a result, executors have a responsibility to keep beneficiaries reasonably informed about the estate and administration. ... As a general rule of thumb, beneficiaries should have enough information about estate assets and estate administration to enforce their beneficiary rights.