Life Insurance Beneficiary

[lostedsoul1968]

What is the name of your state? Texas

I hope someone can help me with this delima. My daughter was listed as a 50% beneficiary in my Grandmother's life insurance policy. We were notified of it on March 19th and to date cannot get it resolved. First they asked for my daughter's birth certificate and a death record which I provided. I contacted them on Arpil 30, 2004 only to find out that that information wasn't enough. Needless to say, they didn't contact me..I had to contact them. Anyways, I was told that there is a law in texas that says that for amounts over $10,000 that I would have to provide court appointed guardianship papers. What I had provided for them were my divorce and custody papers that also state in them that the home state of arkansas would retain the jurisdiction of the minor till 18 and the home state would be Arkansas till 18 too.

In the first letter I received from the Insurance comapny it states that my daughter c/o me are named as 50% beneficiary. and that if the child has reached 18 the check would be payable to her. Otherwise, the check would be payable to the custodian for the benefit of the child.

Does anyone have any advice for dealing with this type of problem?? I feel I am getting the run around with this company (American Enterprise Life) because I feel I have given them everything to prove I am her custodian and Natural Guardian. Any help that can be provided will surely help. Thank you.

 

[Dandy Don]

What state did grandmother die in?
Where do you live and where does your daughter live?
Exactly how old is your daughter now?

When you say "home state of Arkansas will retain jurisdiction of the minor till 18" do you mean that she is required to live in that state only?

Yes, it does seem as if the insurance company is giving you a harder time than is required, but you also need to be talking to a local family law attorney who specializes in guardianships to find out what the cost of obtaining guardianship papers would be and how easy/difficult the process is and how long it takes. Did the insurance company give you a specific answer verbally or in writing when you asked them why they are asking for guardianship papers?

 

[lostedsoul1968]

My grandmother died in Virigina.
My daughter and I live in Texas.
My daughter is 10 years old.

My daughter isn't required to live in Arkansas but I was only given permission to move to texas by the court. If I chose to move elswhere I would have to take it back to the court. In looking up the law, I am her Natural guardian and I have pointd that out to them. Verbally I was told that anyone could claim guardianship of my daughter and therefore I needed something to prove that I am hers. I was told that there is a Texas law stating that guardianship papers were needed if the amount was over $10,000. I have searched and searched and so far I have not seen anything that even remotely states that. I did point out that the annuity stated that she was beneficiary c/o me and that it states that if she was a minor then it would be paid to the custodian for the benefit of the child. Unfortunately, I cannot afford an attorney at this time and the whole purpose my grandmother did this was to help with raising her since my daughter's father doesn't really help. That is why I wsa seeking here.

 

[Dandy Don]

I am still a bit confused. Are you an "official" guardian (declared by a court) or when you said "natural" guardian did you mean just unofficially by virtue of being her natural mother? It's hard to figure out why the insurance company would be asking you for guardianship papers if you are her mother, but I think that they may be asking for this in an obscure way to protect the daughters interests by wanting the money to be held in an account that you would have limited access to or no access to in order to prevent you from being able to spend this money and them wanting to make sure it is held in trust for the daughter until she becomes 18.

It really wouldn't hurt you to at least talk to a family law attorney about this just to find out what the cost would be (it may be fairly inexpensive) or the attorney might be sympathetic to your cause and do it pro bono. If you don't do anything, the case is at a standstill and you have no other recourse except to file a complaint with your state insurance commissioner. An attorney could also help you negotiate with the insurance company to get all their concerns answered and perhaps could come up with a compromise to satisfy everyone.

DANDY DON IN OKLAHOMA ([email protected])

 

[lostedsoul1968]

There has never been an official guardian appointed for my daughter simply because there was no need to. I am her natural guardian (meaning her mother). and her legal custodian by a custody order.I know that my grandmother's wishes were vary clear in stating that my daughter c/o me was beneficiary and would not like this one bit. I did however find a law for texas that is under the Texas Uniform Gifts to Minors Act under the property code-Title 10, Chapter 141. It does state something about the amount being over $10,000 but I am unclear as to the total meaning of this Act.

 

[Dandy Don]

I did some more research on this and I think that the insurance company may be a little bit mixed up.

A minor (your daughter) is not allowed to be in financial control of proceeds from stocks, bonds, life insurance policies, etc., so this is why the Texas Uniform Gift to Minors Act was established so you can set it up in her behalf. Any bank or stock brokerage firm can help you set up this UGMA account and can help explain the details to you, and you can read more details about it at the website "http://www.finaid.org/savings/ugms.phtml". It is fairly simple to understand and an attorney's assistance is not needed to set up this account.

 

[Dandy Don]

What I really meant to say was that when the insurance company told you about being a custodian but they meant custodian of the UGMA account, NOT a legal custodian of your daughter, although in this case they mean the same thing. That paperwork can be done at whatever bank or stock brokerage firm you use to help you set up the account and it is probably free or fairly inexpensive to do. Good Luck!

 

[lostedsoul1968]

I am not sure what they meant and what you are saying are the same. The lady at the insurance company stated that particular law and in reading it it has nothing to do with financial aid for school. She stated if it had been under $10,000 then there would have been no problem but because it is such a high amount of a life insurance policy that is why they would need it. Of course she told me this before she sent it to their legal department for their opinion. I did look for the law that they were talking about as I stated in my previous post but I really am unclear as to what that particular law means. Thanks for your help in this. I really appreciate it.

 

[Dandy Don]

The lady at the insurance company was just automatically assuming that you were going to put this money into the UGMA trust account because you wanted to save it to use for her college education, since that is what most of the accounts are set up for and used for. Of course, your daughter can use it for that if she wants when she gets older, but you need to read the rules and regulations when you set up the account to find out whether if she decides NOT to go to college that she can spend the money on something else.

 

[lostedsoul1968]

I have received their official version of a denial stating that custody is basically guardianship of the person and not guardianship of the property. they are stating that I need to submit guardianship paperwork that names me legal guardian of my daughter and that it enables me to sign for monies paid to her. Now what the heck do I do?? How do I go about getting that done?? I still would have thought that since I can name a guardian and that I can sign notes and everything giving my daughter permission to do various things and since I am her Natural Guardian, that I would not need to do all this. Any suggestions?? I sure would appreciate it because I am getting very frustrated jumping through all these hoops for this company.

 

[Dandy Don]

Talk to several family law attorneys until you find one willing to be sympathetic enough to help you with this, or visit your local Social Services/Welfare agency to see if they could help provide you with an attorney referral or caseworker who is experienced with guardianship enough to advise you what to do. It is probably a fairly simple process.

 

[nextwife]

I suggest you obtain what they are looking for: LEGAL custody. Right now you have custody by default, it sounds. Has the father's legal paternity been established? If and when it is (the father can petition for this anytime up to majority), both parents are considered equally entitled to custody in the absense of a Court Order to the contrary. The insurance company is looking for a court order that legally establishes which parent has court ordered control over the child.

In a marriage, that would be both.

In a divorce, it would be per CO.

In a never-married, both legal parents generally have equal status until there is a CO to the contrary. You have evidentally failed to show the insurance company any CO stating you have been granted legal control. If you have none, getting one is a really good idea anyway.

 

[lostedsoul1968]

It states plainly and clearly in the divorce order who has primary custody (me) over the child. And yes, paternity was established a long time ago. I have not failed to prove to the insurance company as to who has custody of the minor child. That is not what they are questiong. They are citing some law here in Texas that states if the amounth is over $10,000, which it is, I have to have legal guardianship over her estate.

The insurance company is stating that Custody basically means over the person and not over the estate. I have since faxed them a letter citing different laws such as, the right of the parents at all times. The parent has the right at all times unless removed by a court to manage the estate of the child. But I am being told because it is over $10,000 that I have to have legal guardianship of my daughter to be able to sign for monies for her. I also stated in this fax to them that I was able to open a savings account for her in her name and my name without papers such as this. The whole darn thing makes absolutely no sense to me. I cannot afford an attorney at the present time and well with Legal aid, they only do domestic violence cases here and so far I have not found an attorney that does not want to charge me $1500 just for guardianship. Heck I would even go so far as to file it myself in Denton County Probate court here in texas but I cannot find the legal form to do so. That is why I posted my question here in hopes that an attorney could point me in the right direction.

 

[krispenstpeter]

The reason it doesn't make sense to you is because the insurance company is correct. You have legal rights over the "BODY" of the child but this is an estate issue that requires a finding of the court that you have estate jurisdiction over the child.

Guardianships are court supervised proceedings for minors and for incapacitated adults. Subject to court authorization and review, a guardian manages the assets of the minor or incapacitated person. Generally guardianships are to be avoided. They require greater lawyer and court involvement. There are annual accountings and there are bonds. There are also restrictions on how the money may be spent as well as how it can be invested.

There are several ways to avoid a guardian of the estate for a minor.
Testamentary Trusts. Any asset left to a minor in a will can be left to a trustee of a trust established in that will. Any non-probate asset left to a minor can likewise be left to the trustee of a trust created in a will
Uniform Transfers to Minors (Section 141.001 et seq , Texas Property Code) (AKA Custodianships)

Any transfer to a minor can instead be made to: "...Grandpa as custodian for Wee Willy Minor under the Texas Uniform Transfers to Minors Act."

Such a provision can be
In a life insurance beneficiary designation
As owner of a life insurance policy
On a bank account
On a stock certificate
On a deed to real estate

In a will providing that any bequest to a minor shall pass to a custodian under the uniform transfers to minors act.
Now custodianships last until age 21

Section 142 trust. Section 142 of the Texas Property Code allows property of a minor collected by a court proceeding to be placed in a court created trust

The trustee must be a corporate trust
The trust must end at age 25 (unless the person is incapacitated)
Guardianship Trust. Section 867 of the Guardianship Code allows a probate court in a guardianship proceeding to create a trust for the benefit of a minor
The trustee must be a corporate trust
The trust can continue until age 25
The trustee must make annual reports to the probate court.
This does not completely avoid the guardianship process but in some circumstances it reduces court involvement and the costs.

In other words, the child MUST be protected and it is your job as parent to make sure the child IS protected according to texas law.

 

[lostedsoul1968]

Yes I have read this law. There was no will used to setup this beneficiary, It is a Life Insurance policy that names my daughter as 50% beneficiary c/o me. That I would have thought was suffice. There was nothing setup in any will for the transfers such as this. Just the insurance policy through American Enterprise Life Insurance.