-
FreeAdvice has a new Terms of Service and Privacy Policy, effective May 25, 2018.
By continuing to use this site, you are consenting to our Terms of Service and use of cookies.
policy owner vs insured person
- Thread starter kbell216
- Start date
Accident - Bankruptcy - Criminal Law / DUI - Business - Consumer - Employment - Family - Immigration - Real Estate - Tax - Traffic - Wills Please click a topic or scroll down for more.
I AM ALWAYS LIABLE
Senior Member
kbell216 said:
My response:
No. Because of the divorce, you no longer have an "insurable interest" in your former spouse. Once she dies, the only thing you'll be entitled to receive is a refund of your premiums.
It would be the same as if you had a life insurance policy on me. You and I have no "connection" to one another, just like you and your former spouse have no connection to each other. As far as the law is concerned, the two of you are "legal strangers."
IAAL
porcelina68
Member
Actually, the beneficiary would need to be changed. Otherwise, the named beneficiary of record would be receiving the benefits, divorced or not.kbell216 said:
I AM ALWAYS LIABLE
Senior Member
porcelina68 said:
My response:
"Actually", you're wrong. Do you have any clue, or idea, what the term "insurable interest" means? Show me case law or a statute that confirms your statement, or stay off the forums.
IAAL
porcelina68
The insurable interest must exist at the time you enter into the life insurance contract, not at the time of the loss or harm. In other words, you must have an insurable interest at the time you take out the policy. However, the insurable interest generally doesn't have to remain at the time of that person's death.
The insurable interest must exist at the time you enter into the life insurance contract, not at the time of the loss or harm. In other words, you must have an insurable interest at the time you take out the policy. However, the insurable interest generally doesn't have to remain at the time of that person's death.
porcelina68
Member
"9. In any event, all ownership and beneficiary designations should be reviewed. Note, in most states divorce does not automatically eliminate the ex-spouse as beneficiary."I AM ALWAYS LIABLE said:
Source:
http://www.eykisfinancial.com/ins-div.html
"A spouse is not divested of the insurable interest held in his wife or her husband upon divorce. Thus, a spouse is not precluded from collecting the proceeds of a life insurance policy that had been purchased on the life of the other marital partner during the marriage so long as the terms of either the divorce decree or the policy do not provide otherwise.
"9. My husband passed away. The beneficiary on his life insurance policy is his ex-wife because he forgot to change it. What can I do to receive the benefit?
The beneficiary designation by your husband probably states, "(ex-wife's name), wife of insured." While she is no longer married to the insured, the courts have ruled that words such as "wife of the insured" are descriptive only. The name of the beneficiary itself is controlling. Therefore, the courts have held that the benefit is payable to the person named as beneficiary whether or not the descriptive term is correct."
Source: Illinois Department of Insurance
Need I go on? I don't think so.
InsuranceLadyAZ
Member
Porcelina's right
You are correct. I, of course, knew you were right away because I have a life insurance policy on my ex-husband. I only wish he'd give me a reason to collect on it.....
You are correct. I, of course, knew you were right away because I have a life insurance policy on my ex-husband. I only wish he'd give me a reason to collect on it.....
I AM ALWAYS LIABLE
Senior Member
My response:
What you're not looking at is the fact that the above is only good when there are CHILDREN involved. Our writer never mentioned "children". When there are children involved, then the "ties that bind" are NOT cut until the children reach the age of majority. The presumption being that the minor children will benefit by the insurance proceeds.
However, when there are no children involved, by statute, a dissolution, legal separation or nullity judgment must contain a notice warning the parties that dissolution or annulment will automatically cancel a party's beneficiary and survivorship rights under estate planning documents (wills, trusts, nonprobate transfer instruments) and in joint tenancy and community property with right of survivorship (but it does not automatically cancel designation of a spouse or domestic partner as beneficiary of the other party's life insurance). The notice must also warn that the parties estate planning instruments, insurance polices, retirement benefits plans, etc. should be reviewed to determine whether changes should be made in light of the dissolution or annulment.
In other words, and under general rules of contract law, once a childless couple are divorced (or where the children are emancipated), there no longer exists the "insurable interest" there once was at the inception; i.e., Due to the divorce, the "consideration" fails, and once, once again, when the "consideration" fails or no longer exists, so goes the contract for insurance - right down the toilet.
IAAL
What you're not looking at is the fact that the above is only good when there are CHILDREN involved. Our writer never mentioned "children". When there are children involved, then the "ties that bind" are NOT cut until the children reach the age of majority. The presumption being that the minor children will benefit by the insurance proceeds.
However, when there are no children involved, by statute, a dissolution, legal separation or nullity judgment must contain a notice warning the parties that dissolution or annulment will automatically cancel a party's beneficiary and survivorship rights under estate planning documents (wills, trusts, nonprobate transfer instruments) and in joint tenancy and community property with right of survivorship (but it does not automatically cancel designation of a spouse or domestic partner as beneficiary of the other party's life insurance). The notice must also warn that the parties estate planning instruments, insurance polices, retirement benefits plans, etc. should be reviewed to determine whether changes should be made in light of the dissolution or annulment.
In other words, and under general rules of contract law, once a childless couple are divorced (or where the children are emancipated), there no longer exists the "insurable interest" there once was at the inception; i.e., Due to the divorce, the "consideration" fails, and once, once again, when the "consideration" fails or no longer exists, so goes the contract for insurance - right down the toilet.
IAAL
Last edited:
porcelina68
Member
Nothing I noted mentioned children. I take it you don't like to be proven wrong.
Above stated that courts have ruled that the "named beneficiary itself is controlling." There is no room to interpret anything else from that.
Also, I notice that you don't name your sources. Point me to where you get your information, and perhaps your arguement will hold water.
Above stated that courts have ruled that the "named beneficiary itself is controlling." There is no room to interpret anything else from that.
Also, I notice that you don't name your sources. Point me to where you get your information, and perhaps your arguement will hold water.
Last edited:
porcelina68
Member
Just an FYI - I work for a very large insurance company. I kinda know a little bit about insurance.
Porcelina is correct, as long as she is referring to an individual life insurance policy. Group plans follow a different route.
The insurable interest must exist at the time the policy is applied for and continues as long as the policy is in force and the named beneficiary maintains a body temp in the 98 degree range. Once the insured dies, the carrier will pay the proceeds to the named beneficiary barring action to the contrary by the courts. It matters not if the insurable interest still exists or not. The carrier has a contractual obligation to pay the named beneficiary.
The insurable interest must exist at the time the policy is applied for and continues as long as the policy is in force and the named beneficiary maintains a body temp in the 98 degree range. Once the insured dies, the carrier will pay the proceeds to the named beneficiary barring action to the contrary by the courts. It matters not if the insurable interest still exists or not. The carrier has a contractual obligation to pay the named beneficiary.
Find the Right Lawyer for Your Legal Issue!
Fast, Free, and Confidential
data-ad-format="auto">