Beneficiary Designation Mistake

[marindependent]

What? Confusing

 

[pfg1]

I always make sure the primary is EXACTLY what they want. Contingent can be done also, but can also be done later if they choose. I hate to hear stories like this... apparently it happens all the time.

Nice step daughters. Sad.

 

[VolAgent]

Have a strong feeling they didn't use an agent for this change. This sounds consumer driven. I think they didn't ask for help.

That is my guess.

I have seen it time and time again when helping people with beneficiary change forms. Despite the form clearly say and my clearly telling them, they seem to think they are amending the beneficiary designation and not completely overriding it. I've had to have people redo their change forms for this very reason.

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I always make sure the primary is EXACTLY what they want. Contingent can be done also, but can also be done later if they choose. I hate to hear stories like this... apparently it happens all the time.

Nice step daughters. Sad.

Eh..

Did mom tell them what the intent was? How well did they really like the step-father?

50k+ just dropped into their laps, and for many people that would solve a lot of financial problems. Also, wouldn't there be tax implications in giving the money to their step-father? I guess they could have disavowed the money and let it go to her estate, although did they even know that was an option?

It is easy to blame them when we only know one side of the story, and third hand at that.

 

[LGilmore]

And sometimes people have "other" people besides their spouse as beneficiary. Maybe he didn't know because she didn't tell him. I have several clients where the spouse is not the primary.

 

[VolAgent]

And sometimes people have "other" people besides their spouse as beneficiary. Maybe he didn't know because she didn't tell him. I have several clients where the spouse is not the primary.

When it is a second or third marriage, beneficiaries always get interesting. I don't ask and I don't judge. I just list who I am told to list and ask them to sign it.

In community property states most companies ask the spouse to sign when they are not the beneficiary. I have no idea of the consequences if the company accepts the beneficiary change form and the spouse did not sign.

 

[Newby]

The best one I ever had was getting cussed out by the insured's Mom and sister because I wouldn't change the beneficiary on a policy for them. He was laying at home dead. They weren't going to call the funeral home or coroner until they got this beneficiary thing fixed. Sis claimed to be POA but had no papers. She about hit me when I told her that dead people don't have POAs.

 

[jdeasy]

I had a death claim early this year on guy that had referred me to his wife, they didn't live together but were still married.

When I wrote his policy he made her the beneficiary. 6 or 8 months later he called me and wanted to change the beneficiary to the funeral home but he didn't want her to know.

Of course I couldn't tell her anyway. But I did have to tell her when she called wanting to know when to expect the check. I just told her that she was not the beneficiary. She insisted she was and that he would not have changed it without telling her.

She was going to cancel her policy and take me and the insurance company to court.

Never talked to her after that. That was Feb or March this year. And she still has her policy.

 

[LGilmore]

"They both agreed to make both of the girls, his step-daughters, 50/50 recipients of both of their policies. This would have paid each over 100K if they both were to die"

Thought about this yesterday. They were "her" kids, so maybe she decided that's what she wanted. As Vol pointed out multiple marriages can lead to different benies.

One thing though, I work in a community property state and they never ask for spouse consent on beneficiary for life. Retirement plans yes, medical plans yes, but never on a life policy.

 

[DHK]

Same in California - qualified plans, yes.

IRAs and life insurance - no.

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And if you're rolling out a plan where one of the options is a joint lifetime annuity, the spouse has to sign off that they know they're giving up that option in favor of the new IRA rollover recommendation.