Ex-Wife Beneficiary

[NYGIRL]

What is the name of your state? New York
My ex-husband recently passed away and left me as the sole beneficiary (listed me by name) of his employer provided group life insurance policy. We have 2 minor children together who live with me. He remarried 3 years ago - no children by that marriage. His widow is contesting the payment of the policy to me. She claims he meant to change it to her name. The current beneficiary form is acceptable to the insurance company and was originally signed by my ex-husband in 1988. Does she stand a chance?

 

[I AM ALWAYS LIABLE]

What is the name of your state? New York
My ex-husband recently passed away and left me as the sole beneficiary (listed me by name) of his employer provided group life insurance policy. We have 2 minor children together who live with me. He remarried 3 years ago - no children by that marriage. His widow is contesting the payment of the policy to me. She claims he meant to change it to her name. The current beneficiary form is acceptable to the insurance company and was originally signed by my ex-husband in 1988. Does she stand a chance?

My response:

Yes, she does. A very good chance.

IAAL

 

[NYGIRL]

Why would she? He left his policy to me to provide for our kids in the event of his death, as I did him - in the event of my death. Don't I have an insurable interest here?

 

[I AM ALWAYS LIABLE]

Why would she? He left his policy to me to provide for our kids in the event of his death, as I did him - in the event of my death. Don't I have an insurable interest here?

My response:

The policy was as a result of his employment. It wasn't a "private" policy. If it was a private policy, then you might have a good argument. Second, you're divorced. A divorce "cuts the ties that bind." If he wanted the children to have the money, he could have easily changed the Beneficiary card to their names. Third, since it was an employment policy of insurance, the money being used to pay the premiums was "equitably" hers, and not yours.

Normally, death benefits go to the member's designated beneficiary. However, the member's dissolution or annulment of marriage automatically revokes a previous beneficiary designation (as does the birth of his or her child, adoption of a child, or termination of employment and withdrawal of contributions). Thereafter, the member may designate the same or another beneficiary . . . subject, however, to the CP interests of the former spouse; e.g., if there was a court order to maintain insurance for the benefit of the children. But, you've never mentioned that such an order was made.

Because he left your name on the policy beneficiary line, and because of your divorce before he passed, your "insurable interest" died right along with him.

IAAL

 

[You Are Guilty]

I'm going to do some research to see if the type of policy has an effect, but in the meantime, here's the NY Department of Insurance's viewpoint: http://www.ins.state.ny.us/rg011061.htm

 

[I AM ALWAYS LIABLE]

I'm going to do some research to see if the type of policy has an effect, but in the meantime, here's the NY Department of Insurance's viewpoint: http://www.ins.state.ny.us/rg011061.htm

My response:

I know you have acknowledged "the type" of policy and will be doing further research on the issue, but you'll find there is a difference in the law between an employment-based policy (as is discussed by our writer) and a privately purchased insurance policy.

IAAL

 

[You Are Guilty]

Don't misunderstand, I'm not advocating that there is. It's an interesting issue I've never dealt with so it piqued my interest. The confounding factor is that NY caselaw on the issue is rather sparse (as noted by the 1914 case cited by the DOI), and on top of that, all the good statutes have been repealed (i.e. DRL 177).

Preliminary results show that there is a recognized difference for those policies procured via "payment from a separate estate", but I'm not happy till I find a case exactly on point. The search continues.

 

[I AM ALWAYS LIABLE]

Don't misunderstand, I'm not advocating that there is. It's an interesting issue I've never dealt with so it piqued my interest. The confounding factor is that NY caselaw on the issue is rather sparse (as noted by the 1914 case cited by the DOI), and on top of that, all the good statutes have been repealed (i.e. DRL 177).

Preliminary results show that there is a recognized difference for those policies procured via "payment from a separate estate", but I'm not happy till I find a case exactly on point. The search continues.

My response:

Excellent. I like your style. Keep digging.

IAAL

 

[You Are Guilty]

Not exactly on point but Van Ostrand v. National Life Assur. Co. of Canada 82 Misc.2d 829, 371 N.Y.S.2d 51 (1975) is about the best case I can find to say that "spouse" excludes someone who the policy holder divorced, but it's premised on the contract's language, so I doubt it will be of much help.

But for a possible light at the end of the tunnel for the OP, there is some caselaw which could support the opposite finding if the divorce decree either made some sort of provision for the life insurance beneficiaries to be changed or maintained; and/or if there was some sort of distribution of the cash value of the policy at the time of the divorce. (Curley v. Giltrop, 68 N.Y.2d 651, 505 N.Y.S.2d 65 (1986), which at least is a Court of Appeals case).

In either event, it looks like it's about time to hire an attorney.