Jimmy McMillan

Licensed Life Insurance Agent

Jimmy McMillan is an entrepreneur and the founder of HeartLifeInsurance.com, an independent life insurance brokerage. His company specializes in life insurance for people with heart problems. He knows personally how difficult it is to secure health and life insurance after a heart attack. Jimmy is a licensed insurance agent from coast to coast who has been featured on ValientCEO and the podcast...

Licensed Life Insurance Agent

Heidi Mertlich

Licensed Life Insurance Agent

Heidi works with top-rated life insurance carriers to bring her clients the highest quality protection at the most competitive prices. She founded NoPhysicalTermLife.com, specializing in life insurance that doesn’t require a medical exam. Heidi is a regular contributor to several insurance websites, including FinanceBuzz.com, Insurist.com, and Forbes. As a parent herself, she understands the ...

Licensed Life Insurance Agent

UPDATED: Dec 4, 2023

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It’s all about you. We want to help you make the right life insurance coverage choices.

Advertiser Disclosure: We strive to help you make confident life insurance decisions. Comparison shopping should be easy. We are not affiliated with any one life insurance provider and cannot guarantee quotes from any single provider.

Our life insurance industry partnerships don’t influence our content. Our opinions are our own. To compare quotes from top life insurance companies please enter your ZIP code on this page to use the free quote tool. The more quotes you compare, the more chances to save.

Editorial Guidelines: We are a free online resource for anyone interested in learning more about life insurance. Our goal is to be an objective, third-party resource for everything life insurance-related. We update our site regularly, and all content is reviewed by life insurance experts.

UPDATED: Dec 4, 2023

Advertiser Disclosure

It’s all about you. We want to help you make the right life insurance coverage choices.

Advertiser Disclosure: We strive to help you make confident life insurance decisions. Comparison shopping should be easy. We are not affiliated with any one life insurance provider and cannot guarantee quotes from any single provider.

Our life insurance industry partnerships don’t influence our content. Our opinions are our own. To compare quotes from top life insurance companies please enter your ZIP code on this page to use the free quote tool. The more quotes you compare, the more chances to save.

UPDATED: Dec 4, 2023Fact Checked

Once a beneficiary is named on a life insurance policy, the general rule is that only the owner of the policy can change who receives the proceeds. This rule is in place to protect insurance policy owners from someone else changing the beneficiary without their knowledge.

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However, there are certain cases where a court will order a beneficiary changed for legal reasons. This does not happen very often; courts are reluctant to take this step unless there is a very good basis for the change. There are, however, a few causes that will move a court to enter this type of judgment.

What if the owner becomes legally incapacitated?

If the owner of a policy becomes legally incapacitated, whether by an accident or disease, and if there is no power of attorney named, a court may decide that a power of attorney must be granted to handle the sick person’s business affairs. This has little to do with life insurance; instead, it is to allow the power of attorney agent to continue to pay bills, satisfy legal obligations, and generally act in the interest of the person who is unable to do so. However, if the incapacitated person has a life insurance policy, and the beneficiary is deceased or there are sound reasons for wanting to change the status of the payout, then the power of attorney agent may be granted the permission to name a different person as beneficiary.

The court may directly order a beneficiary to be changed, as well, even if there is not a power of attorney involved. Part of the court’s decision depends on the type of beneficiary named in the policy.

What about life insurance policies with irrevocable beneficiaries?

Some policies have irrevocable beneficiaries. This means that once the beneficiary is named, it is nearly impossible to have another person named unless a judge so rules. Obviously, this type of case involves a protracted legal battle, and it is primarily up to the judge to decide if the reasons for overriding the irrevocable beneficiary clause are valid.

However, if the beneficiary is revocable, meaning the name can be changed at any time by the owner of the policy, a court may be more inclined to become involved. There are some predictable scenarios where a judge might decide that a beneficiary should be changed because the owner would have wanted the change made, or it would be in the owner’s best interest to have the beneficiary changed.

For example, if the owner of a policy is in the process of a divorce just prior to death, and neglects to change the beneficiary from the former spouse, the children or other family members may petition the court to have the beneficiary changed from the ex-spouse. Divorce and marriage do not affect a life insurance policy per se; however, evidence may be presented to the court that the owner intended to change the beneficiary before death, and the court may consider this when making a decision.

Obviously, there is no standard decision in a case such as this. The judge will have to look at the facts of the case, listen to witness testimony, and review any documents which may be presented to show the deceased’s intentions.

What if a life insurance policy was changed shortly before a person’s death?

Another scenario which may result in a judge intervening is when an insured changes his or her beneficiary just prior to death, under the influence of someone else, while the insured is very ill. There have been cases where courts ordered that life insurance proceeds be paid to family members even though the insured changed the beneficiary to a friend or someone unrelated just prior to death, because the judge believed the friend had unduly influenced the sick person to  change the insurance policy. These situations involve long, drawn-out legal battles and tremendous costs. It may actually cost more to fight a case of this type than the face value of the policy, so avoiding situations like this is the goal, not fighting these battles in court.

When taking out an insurance policy, it is important to name beneficiaries in such a way that there is no question as to the intent of the insured. Most often, spouses and children are named in some proportion, although minor children’s shares must be held in trust until they reach legal age. If divorce or death intervenes, it is important to change the beneficiaries in a timely manner to reflect the new situation. If the owner of a policy wishes to make changes, it is also important to talk to an agent and sign the change in the presence of witnesses, in case there is ever any question about the validity of the choice of beneficiary. It is often possible to name secondary or tertiary beneficiaries, and this practice also helps prevent court disputes in case the insured and the primary beneficiary die at close to the same time.

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Jimmy McMillan

Licensed Life Insurance Agent

Jimmy McMillan is an entrepreneur and the founder of HeartLifeInsurance.com, an independent life insurance brokerage. His company specializes in life insurance for people with heart problems. He knows personally how difficult it is to secure health and life insurance after a heart attack. Jimmy is a licensed insurance agent from coast to coast who has been featured on ValientCEO and the podcast...

Licensed Life Insurance Agent

Heidi Mertlich

Licensed Life Insurance Agent

Heidi works with top-rated life insurance carriers to bring her clients the highest quality protection at the most competitive prices. She founded NoPhysicalTermLife.com, specializing in life insurance that doesn’t require a medical exam. Heidi is a regular contributor to several insurance websites, including FinanceBuzz.com, Insurist.com, and Forbes. As a parent herself, she understands the ...

Licensed Life Insurance Agent

Editorial Guidelines: We are a free online resource for anyone interested in learning more about life insurance. Our goal is to be an objective, third-party resource for everything life insurance-related. We update our site regularly, and all content is reviewed by life insurance experts.