In California, the rules governing life insurance beneficiaries are generally based on the terms of the life insurance policy itself. However, there are some important legal requirements and rules that apply to life insurance beneficiaries in California. The following are some key points to keep in mind:
- Community Property Laws: California is a community property state, which means that any property acquired during a marriage is generally considered to be owned equally by both spouses. In the case of life insurance policies, if the policy was purchased with community funds during the marriage, the spouse may have a community property interest in the policy. This means that the spouse may be entitled to a portion of the life insurance proceeds, even if they are not named as a beneficiary.
- Primary and Contingent Beneficiaries: Life insurance policies typically allow the policyholder to name both a primary beneficiary and one or more contingent beneficiaries. If the primary beneficiary predeceases the policyholder, the contingent beneficiary will receive the proceeds. If no beneficiary is named, the proceeds may be paid to the policyholder's estate.
- Irrevocable Beneficiaries: If a beneficiary is designated as "irrevocable" on a life insurance policy, the policyholder cannot change the beneficiary without the beneficiary's consent. This can provide some protection for the beneficiary, but it can also limit the policyholder's flexibility in making changes to the policy.
- Minors as Beneficiaries: If a minor child is named as a beneficiary, the life insurance proceeds may be held in a trust until the child reaches the age of majority. This can help ensure that the proceeds are used for the benefit of the child and are not squandered.
- Beneficiary Designation Forms: To ensure that life insurance proceeds are distributed according to the policyholder's wishes, it is important to complete a beneficiary designation form and keep it up to date. If the policyholder wants to make changes to the beneficiary designation, they should complete a new form and submit it to the insurance company.
Overall, it is important to consult with an experienced attorney to ensure that the life insurance beneficiary rules in California are properly understood and followed. We handle all delayed and denied life insurance claims as well as beneficiary disputes and interpleader lawsuits.