Who is entitled to the life insurance benefits?

My stepdad had my sister and I as beneficiaries on his life insurance. Our mother took ownership of his insurance policy when he was put in a nursing home. Our stepdad passed away this week and I wanted to know, since our mom has ownership of the policy, will the policy be paid out and will my sister and I still receive the money?

Life Insurance
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March 2017
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I am sorry to hear about your loss.

One of the great things about Life Insurance is that it avoids probate, and regardless of what the will or anything else says, whatever is listed on the beneficiary form is where the money is going to go. The Supreme Court has heard many cases in regards to beneficiary forms and who gets what. They have ruled in favor of the beneficiary form many times over. If you and your sister are labeled as the beneficiaries, then you both are entitled to the proceeds, regardless of what anything else says in a will or trust. It also doesn't matter if your mom was labeled as the owner, the insurance proceeds are paid out to the beneficiaries only.  As long as the beneficiaries had not been changed, you and your sister will receive the life insurance proceeds. Typically, the insurance company will require a death certificate before they will pay out any of the benefit.

Hope that helps.

Vincent Oldre, CFP®

March 2017
March 2017
March 2017