Life Insurance Beneficiary Disputes

If you are involved in a dispute over life insurance proceeds, you are not alone. Every year, thousands of beneficiary disputes arise after the death of an insured, often leading to delays, denials, or interpleader lawsuits. At Lassen Law Firm, we focus exclusively on helping beneficiaries resolve life insurance disputes nationwide. Christian Lassen, Esq., a life insurance attorney with over 20 years of experience, personally handles every case to protect your interests and enforce your rights.

If a life insurance beneficiary dispute arises, the insurance company may delay payment, file an interpleader lawsuit, or deny the claim altogether. Beneficiaries have the right to challenge disputed claims and fight for their rightful share.

What Is a Life Insurance Beneficiary Dispute?

A beneficiary dispute occurs when two or more individuals claim they are entitled to receive life insurance proceeds, or when the validity of a beneficiary designation is challenged. Disputes may involve claims of fraud, undue influence, forgery, divorce-related revocation issues, or accusations that a designation was changed improperly.

When disputes arise, insurers often delay paying benefits until the legal issues are resolved.

Why Beneficiary Disputes Arise

Beneficiary disputes commonly occur due to last-minute changes to designations, divorces that impact former spouse designations, competing claims from multiple parties, allegations of mental incapacity, or claims that the insured was coerced into changing a beneficiary. Sometimes disputes arise simply because policies were not updated after major life events.

These conflicts can quickly escalate into lawsuits if not resolved promptly.

How We Help Resolve Life Insurance Beneficiary Disputes

At Lassen Law Firm, we represent beneficiaries in disputes involving life insurance proceeds. We investigate the circumstances surrounding the beneficiary designation, challenge improper claims, and defend rightful beneficiaries against competing claims. Our firm aggressively pursues resolution through negotiation or litigation when necessary.

For example, we recently helped a daughter recover $300,000 in life insurance benefits after an estranged spouse contested the designation, arguing the change was invalid. We successfully defended the daughter's right to the proceeds in court.

Common Causes of Life Insurance Beneficiary Disputes

Last-minute changes to beneficiary designations
Divorce revoking a prior spouse’s designation
Allegations of undue influence or fraud
Disputed handwritten or improperly witnessed designations
Multiple conflicting beneficiary forms
Mental incapacity of the insured at the time of change
Employer error in updating group policy beneficiaries
Disputes involving children from different marriages
Alleged forgery of beneficiary documents
Interpleader lawsuits filed by the insurer to resolve conflicts

What to Do If There Is a Life Insurance Beneficiary Dispute

If you are involved in a life insurance dispute:

Gather all beneficiary forms, policy documents, and communications.
Request a complete copy of the policy and all designation records from the insurer.
Avoid communicating directly with other claimants without legal advice.
Contact an experienced life insurance dispute attorney immediately.
Act quickly to preserve your legal rights and contest improper claims.

Beneficiary disputes can escalate fast — early legal intervention often determines the outcome.

Frequently Asked Questions About Life Insurance Beneficiary Disputes

What happens if there are multiple beneficiary claims?

The insurer may file an interpleader lawsuit, asking a court to determine who is entitled to the proceeds.

Can a beneficiary designation be changed shortly before death?

Yes, but last-minute changes are often challenged based on claims of undue influence, lack of capacity, or fraud.

Does divorce revoke a beneficiary designation?

In many states, yes. Divorce may automatically revoke an ex-spouse’s right to life insurance unless reaffirmed afterward, but ERISA policies are different.

Can a handwritten note change a beneficiary designation?

Sometimes. Handwritten beneficiary changes must comply with policy and legal requirements to be valid.

What if the insured was mentally incapacitated when changing beneficiaries?

Changes made during incapacity can be challenged and potentially invalidated in court.

What is an interpleader lawsuit in life insurance?

An interpleader is when the insurer deposits the life insurance proceeds with the court and lets the court decide who should receive them.

Can a beneficiary designation be forged?

Yes, and if proven, the forged designation will be invalidated, and rightful beneficiaries will prevail.

Can minor children be named as beneficiaries?

Yes, but life insurance proceeds for minors are often placed in court-supervised trusts until the child reaches adulthood.

Can a parent override a beneficiary designation?

No. Once a beneficiary is named, parents have no authority to override the designation unless fraud or incapacity is proven.

Are beneficiary disputes common with second marriages?

Yes. Disputes often arise between current spouses and children from prior relationships.

Can life insurance proceeds be divided among multiple beneficiaries?

Yes. If the designation provides for multiple beneficiaries, proceeds are typically divided as specified.

What if no valid beneficiary is named?

The proceeds will usually pass according to policy defaults or the insured’s estate laws.

Can life insurance be contested if there is a pending divorce?

Possibly. If divorce proceedings were underway but not finalized, beneficiary rights may be contested.

How long do I have to contest a beneficiary designation?

Deadlines vary by state, but it’s important to act promptly once a dispute is known.

Can employers be liable for beneficiary designation mistakes?

Yes. In some cases, employer error in handling beneficiary forms can lead to legal liability.

Do ERISA rules affect beneficiary disputes?

Yes. Group life insurance policies under ERISA follow federal rules, and courts must follow the last valid designation on file.

What happens if the beneficiary designation was unclear?

Courts may review evidence to determine the insured’s intent and resolve ambiguity.

Can deathbed changes to beneficiaries be challenged?

Yes. Deathbed changes often trigger challenges based on undue influence or lack of mental capacity.

How can a lawyer help with a life insurance beneficiary dispute?

An attorney can gather evidence, challenge improper claims, defend rightful beneficiaries, negotiate settlements, and litigate if necessary.