Death Benefits Question

[jlive8]

What is the name of your state? Arkansas

Need some help here.

My sister had a life insurance policy that didn't have a named beneficiary. The insurance company reverted to her medical insurance. My sister did not fill out a beneficiary form because she probably did not know she had the life insurance. The state gave their employees an automatic $10,000 for life insurance. I spoke with some employees around my work area and they stated they didn't know that happens. The insurance company stated in a letter that the named beneficiary was named on 9-17-01. Well the state didn't give the $10,000 until January of 2002, so obviosly she didn't fill out a beneficiary form. Also my sister was divorced from the beneficiary on February of 2002. My question is, Is there a loophole through this because of them reverting to the medical insurance and also her being divorced?

 

[ALawyer]

Let me see if I can understand this. I assume that your sister worked for the state of Arkansas. That efffective 1/1/2002 the state provided its employees (or allowed them to buy) health insurance and that the health plan INCLUDED a $10,000 death benefit.

I would suggest that you ask to see EXACTLY what paperwork she was given in connection with the new health plan, and exactly what, if anything, she may have filled out, and also ask for a copy of both the Summary Plan Description" and the policy(ies) themeselves. Normally in policies of this type there would be some wording in the application or sign-up form that says who the beneficiary will be, and if not, that information is contained in the p[olicy itself -- and a "facility of payment" provision usually says or specifies next of kin.

Now of course the divorce often changes things and in some states the law provides the divorce decree automatically revokes prior wills and beneficiary designations, and in other states it is permissive only, and in some circumstances the separation agreement may specify the consequences and rights. I am clueless as to the local law of Arkansas.

Get the papers first, and then if the answer is not to your liking, see a lawyer.