Am I legally obligated to give the family money if I’m named as the sole beneficiary on my friend’s life insurance policy?

My very close friend and her 5 year-
old son were murdered by her boyfriend
he has admitted to the crime and is
on trial now right before Christmas
last year. She and her son were like
my family, and she always treated me
like her sister she has 2 brothers.
About a month after this tragedy, I
was contacted by an insurance company,
and was informed that I was named as
her sole beneficiary for a pretty
large policy. They searched for me,
because it was evident that I had no
knowledge of this policy at all- she
had purchased it a year and a half
before that, and didn’t include some
of my personal info. I was floored and
had no idea. I’m sure it was for me to
take care of her son, since his father
had already passed and her family is
kind of broken and she had always
indicated that she did not like all
the drama they were involved in. This
woman had a master’s degree, and was
an associate professor with no known
health or mental problems. The
insurance company paid out to me after
their own investigation, since it was
still in the contestable period. They
refused to speak with the family,
since the family found out and kept
hounding them for details. The family
had no knowledge of this policy,
either, and raised the money, plus
some, for final expenses via
fundraiser. My husband and I
contributed a huge amount to this,
before we had any knowledge of
insurance funds.
After going through her paperwork,
her family began harassing me nonstop,
asking for information, demanding that
I give then the money, saying they’d
‘allow’ me to keep a portion , but
this has completely stressed me out.
They have conceded verbally and in
written for that they know I was
closer to her than a sister, and they
know she wanted me to do this, and
that if her son was still here, they
assumed I would take over his care,
since they are ‘not young enough’ to
deal with a kid. It’s unbelievable.
They just want money, when they are
out no money for her bills or final
expenses.

My intention was to give each parent
they are divorced and brother a
pretty huge sum, and donate a portion
in my friend’s honor. I never intended
to keep much for myself, but I’m
feeling so unsafe because of their
harassment and constant badgering,
that I want to know what my rights
are. If they chose to sue me after I
gave money to them there have been
lies, guilt trips, subtle threats,
for the rest,what chance do I have of
losing everything? I’m already
stressed from being pregnant with
another child of my own. I’ve never
dealt with this kind of greed before.
Thank you.

Asked on May 15, 2016 under Insurance Law, Kentucky

Answers:

S.L,. Member, California Bar / FreeAdvice Contributing Attorney

Answered 4 years ago | Contributor

Sorry to hear about your friend and her son.
As the sole beneficiary of the life insurance policy, you are under no obligation to give any of the money to the family.  You are entitled to keep the entire amount.
You may want to consider getting a restraining order to stop the family's harassment since you feel unsafe.


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