Can an ex-spouse collect under a life insurance policy on the otherex-spouse?

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Can an ex-spouse collect under a life insurance policy on the otherex-spouse?

My brother’s estranged wife drove him to commit suicide; we have piles of evidence. Now she stands to collect on his $1,000,000 life insurance policy. Is there anything we can do as his family to prevent that from happening or to redirect the funds to his children?

Asked on January 3, 2012 under Insurance Law, Ohio

Answers:

M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

Unfortunately, life insurance benefits are typically paid to the named beneficiary regardless of their status as a spouse or ex-spouse. As a general rule, divorce has no effect on who is designated to receive life insurance benefits; it does not automatically remove the ex-spouse as the beneficiary. The fact is that many people name their spouse as their life insurance beneficiary and subsequently fail to update their policy in the event of divorce. In most jurisdictions, the owner of a policy must change the beneficiary of their policy if they do not want their ex-spouse to receive policy proceeds.

That having been said, there are instances in which an ex-spouse is not eligible to collect such benefits even if they are named as beneficiary. For example, if the insurance policy itself contains a provision that excludes a beneficiary from receiving benefits if spousal status does not exist at the time of the insured’s death. Also, a divorce decree may provide that the ex-spouse is no longer eligible to receive life insurance proceeds. Further, some states have enacted laws that revoke a person’s beneficiary rights upon divorce.

At this point you need to consult with an attorney in your area and have them specifically explain OH's position on an revoking an ex-spouse's right to collect. Additionally, they (or you) can check the original divorce decree to see if the issue was addressed, as well as checking the language in the policy itself.


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