Life insurance primary beneficiary dies 4 days after policy owner

[apphia]

This is a real situation in my life:

• Man dies with 500k term life insurance policy to pay out to Primary Beneficiary (Wife). Second Beneficiary also listed.
• His primary beneficiary (wife) dies 4 days later, they hadn't even looked at the policy yet as she was grieving his death.

Does the life insurance proceeds go to the estate of the primary beneficiary or does it go to the secondary beneficiary? I am in charge of executing the estate of the deceased wife. The secondary beneficiary is not on the will. So this individual will either receive $500k or $0.

 

[tabinek]

@apphia Read the policy carefully as this situation may be covered and that language will control the payment. Many contracts have language that covers situations when a beneficiary and the insured pass at the same time and in that situation the contract stipulates that it is to be assumed that the beneficiary has predeceased the insured so the contingent is automatically in play. This provision is mostly designed for car accidents, plane crashes, etc. but depending on the wording could apply here too.

After that, the answer to this may vary based on actual laws or case law precedent in each state.

But absent some other controlling language in the policy the death benefit became payable to the primary beneficiary on the date of death and may be considered an asset of the primary beneficiary’s estate.

The company is in the best position to answer this. Give the person that answers the phone some grace on this… it isn’t a common situation and you want them to investigate this thoroughly and give you the right answer.

Edit: fixed some typos

 

[thesecularhumanist]

@apphia If the secondary beneficiary is listed as such on the policy, he or she would receive the $500k. If there is no secondary beneficiary listed on the policy, it will go to the estate.

 

[jeffc1983]

@thesecularhumanist This!!!!

 

[soldier84]

@thesecularhumanist Yes this is the answer.

 

[resjudicata]

@thesecularhumanist This is, likely, not the case.

It all depends on the contact, state, and actual designation.

In most cases like this, it would go to the primary benes estate if they outlived the insured.

Some people may have a "simultaneous death" clause. If the primary bene dies within X days of the insureds death, it would then go to the secondary beneficiary.

It could vary by state, but as a former life claims supervisor, I can tell you that it doesn't automatically go to the second bene..

 

[wynning826]

@apphia Could be a delay clause. I used to do 15 days consistently. For exactly this reason.