sister contesting life insurance beneficiaries

[dkewish]

What is the name of your state (only U.S. law)? IN
My wife and her only full blooded sister are the named beneficiaries on their late father’s group life insurance policy through his work. What happened was the insurance company somehow lost the beneficiary list or his work had it. So they were under the impression that he had no listed beneficiaries. They contacted us and asked for all of his children’s contact info. They never told us any amounts or anything. Upon contacting my wife’s older brother and sister they disclosed to them just how much money they would be getting if the money was split evenly. Then somehow the beneficiary list that listed just my wife and her sister pops up and they told my wife’s older brother and sister that they would not be receiving anything. They are now contesting the claim. The insurance coordinator told me that they have 45 days to provide legal basis as to why they should receive part of the payout otherwise she will disburse it to the listed beneficiaries. These two siblings were never a part of my father in laws life. Actually the brother was adopted when he was three. He is in his thirties now. I know that anyone can contest a claim. My questions are do they have any legal ground to stand on? Do we really have to wait 45 days because we are paying the funeral home with the insurance money? Can we go after the insurance company for disclosing information to them that they didn’t even tell us since they weren’t named beneficiaries? Should I be consulting my lawyer that is handling his estate just to be on the safe side? And the older sister said that if it doesn’t get split the way she wants that she will also contest his estate. Can she really cause this much problems for us. We plan on splitting the money with her just not the way she wants it. Any answers are more than welcome.

 

[Zigner]

What is the name of your state (only U.S. law)? IN
My wife and her only full blooded sister are the named beneficiaries on their late father’s group life insurance policy through his work. What happened was the insurance company somehow lost the beneficiary list or his work had it. So they were under the impression that he had no listed beneficiaries. They contacted us and asked for all of his children’s contact info. They never told us any amounts or anything. Upon contacting my wife’s older brother and sister they disclosed to them just how much money they would be getting if the money was split evenly. Then somehow the beneficiary list that listed just my wife and her sister pops up and they told my wife’s older brother and sister that they would not be receiving anything. They are now contesting the claim. The insurance coordinator told me that they have 45 days to provide legal basis as to why they should receive part of the payout otherwise she will disburse it to the listed beneficiaries. These two siblings were never a part of my father in laws life. Actually the brother was adopted when he was three. He is in his thirties now. I know that anyone can contest a claim. My questions are do they have any legal ground to stand on? Do we really have to wait 45 days because we are paying the funeral home with the insurance money? Can we go after the insurance company for disclosing information to them that they didn’t even tell us since they weren’t named beneficiaries? Should I be consulting my lawyer that is handling his estate just to be on the safe side? And the older sister said that if it doesn’t get split the way she wants that she will also contest his estate. Can she really cause this much problems for us. We plan on splitting the money with her just not the way she wants it. Any answers are more than welcome.

Your wife and her sister will need to wait the 45 days.

 

[MichaelBurton]

What is the name of your state (only U.S. law)? IN
My wife and her only full blooded sister are the named beneficiaries on their late father’s group life insurance policy through his work. What happened was the insurance company somehow lost the beneficiary list or his work had it. So they were under the impression that he had no listed beneficiaries. They contacted us and asked for all of his children’s contact info. They never told us any amounts or anything. Upon contacting my wife’s older brother and sister they disclosed to them just how much money they would be getting if the money was split evenly. Then somehow the beneficiary list that listed just my wife and her sister pops up and they told my wife’s older brother and sister that they would not be receiving anything. They are now contesting the claim. The insurance coordinator told me that they have 45 days to provide legal basis as to why they should receive part of the payout otherwise she will disburse it to the listed beneficiaries. These two siblings were never a part of my father in laws life. Actually the brother was adopted when he was three. He is in his thirties now. I know that anyone can contest a claim. My questions are do they have any legal ground to stand on? Do we really have to wait 45 days because we are paying the funeral home with the insurance money? Can we go after the insurance company for disclosing information to them that they didn’t even tell us since they weren’t named beneficiaries? Should I be consulting my lawyer that is handling his estate just to be on the safe side? And the older sister said that if it doesn’t get split the way she wants that she will also contest his estate. Can she really cause this much problems for us. We plan on splitting the money with her just not the way she wants it. Any answers are more than welcome.

1) Disclaimer: I am not a lawyer. But I am a 14 year veteran of the life insurance industry, familiar with claims procedures & dealing with these companies.

2) I would send a certified letter to the insurance company stating the facts as you understand them, inviting them to clarify what actually happened that lead them to contact your siblings. It sounds to me like you were tricked into an implicit authorization to contact your disenfranchised heirs. Why would an insurance company want to do that? You might think it would be to induce a fight so they can hold on to the money. There is probably some truth to this. I suspect that the real reason is they do not want to get sued by your disenfranchised siblings after the distribution. You can imagine how frequently this would happen, can't you? Especially if the amount of insurance is large enough. The cheapest way to mitigate their litigation risks is probably to induce the family to fight over things among each other. Then they can take the high ground: "we'll pay out whenever y'all get your shyt together." This is a crappy but understandable way to go about things in litigous times. I doubt you will have any recourse against the company for contacting your siblings if you supplied it with the contact names (and information?).

3) Your call with the company was probably recorded. You might ask for a transcript of the call.

4) I would definitely consult with an attorney before I did anything. Maybe draft the letter and request, take it to a lawyer buddy, and pay him/her to edit and send it on his/her letterhead? I dunno for sure. It's just a thought.

5) Lastly, and probably most importantly, I would seriously, seriously consider just sharing the benefit equally. Have a dialogue about it. Whatever happened between your wife's Dad and her older siblings, and regardless of her Dad's intentions, the practical effect of his beneficiary choices is very divisive. If you choose to continue down this path, you will be extending those fractured family dynamics for many generations.

This could be an opportunity for great healing in your family. I would urge you to enter into the dialogue with your siblings.

What amount of money is worth a lifetime lived in estrangement from one's siblings? What regret will your wife have for not giving real heart to heart dialogue a try?

I have a client who was terribly abused by her father. After multiple attempts to confront and reconcile, the father proved unwilling to accept responsibility and seek treatment for huge sources of loss, woundedness, and mental illness in his own life. He was proving to be a danger to my client's children. So, after much consideration and multiple opportunities for the Dad to demonstrate genuine desire to change/heal, my client had to sever the relationship.

I have a second client who happens to be the older sibling of my other client. She referred them to me. Their experience of the father has been difficult enough that I can tell they know he's pretty crazy, too. But they have not severed the relationship. The older sibling has a hard time understanding why the younger sibling must remain disconnected. What is clear to me, which I cannot disclose, is that the nature of the abuse suffered by the younger sibling was much worse than what the older child experienced.

This often happens in abusive family dynamics: for complex reasons, a certain child is singled out for abuse, while another is singled out for favor. It is tragic. Intuitively, the lesser abused children know that the safest course of action is to remain a passive observer. Or even to participate. It is a sick and twisted dilemma parents can force upon a child who, in survival mode, has little choice but to remain silent.

I suspect that the father, a man of great means who clearly used his money to manipulate his family, will probably disinherit the younger sibling. While it might look as though it were the obvious choice (the younger sibling wanted nothing to do with the father); the reality, in my opinion, is that it will just be another way to extend the excessive and selective abuse upon the same "scapegoat."

I wonder what the older sibling will do when that day comes? Will he passively let it happen, again? If so, he will have to answer for that as an adult under no threat of harm. The abusive dad will be dead. All that will remain is a brother and sister. What will become of their relationship? I don't know.

But if I am invited to offer my opinion, which I suspect I will be, I will challenge the older sibling to consider if in fact the younger sibling should be honored for the prolific abuse she bore as a child, that protected the older sibling from great and graphic harm. Perhaps, I will ask, she is "owed" more of her dad's estate than you?

I don't know what they will decide. But I hope whatever it is, that genuine empathy and understanding will be shared by these traumatized siblings so that they can enjoy a better and deeper relationship for the rest of their lives.

TIFWIW.

 

[justalayman]

Bottom line: named beneficiary list rules unless a person contesting can give legal cause it shouldn't. It takes a lot to prove that. Arguing they should have gotten something won't win it. It would require things like coercion in naming the bene's.

Personally I would not share the money. If your father in law wanted the others to be beneficiaries he would have named them as such


The rest is simply going to have to run its course as it winds through probate.


Your father in law's estate is liable for the funeral expenses. Do not short change yourself in this situation