Can a life insurance company pay benefits to survivors that are not named as beneficiaries?

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Can a life insurance company pay benefits to survivors that are not named as beneficiaries?

Recently my brother passed and has designated my to sisters and myself as the legal beneficiaries of his life insurance policies. He had gone through a very nasty divorce during which his 2 children abandoned him; we even have a police report where his daughter assaulted him. Now the children have approached the life insurance company to try to claim the benefits. The company has now told me that they have decided to pay the children the benefits. How can the insurance company go against the legal wishes of my brother when the proper paper paperwork was filed with their company?

Asked on October 8, 2011 under Insurance Law, Missouri

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

There is no way to provide a definitive answer, without someone reviewing the insurance policy; you should therefore consult with an attorney to help you. That said, as a general matter, an insurer may NOT go against the clearly stated wishes of the insured, as set forth on a properly executed insurance policy. If beneficiaries are listed by name, the proceeds must be paid to them. Sometimes the insured makes a mistake, though, in how he or she designated beneficiares, and leaves some "loophole"--e.g., leaving benefits to his current  spouse by name, instead of to, "my wife," which means that if he divorces and remarries, the benefits still go to his x-wife; or desginating insuarance benefits to go to  his estate, in case they will pass by his will or (if no will) intestate succession)--which could mean to someone he'd rather not get them. Therefore, the policy must be examind as the first step to determine who should receive the benefits.


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