Keeping Life insurance Beneficiaries Updated

After you’ve been approved for life insurance and have paid your annual premiums, you might prefer to put your policy out of your head. While death and taking care of your family after you are gone is something you’d rather not think about, consider how unfortunate it would be if you passed away and your spouse found your beneficiary was a special someone from before you met him or her.

It is very important you keep your beneficiaries updated to avoid confusion and litigation after you are gone. It is fairly simple and there is no cost, there’s really no reason not to update your beneficiaries each and every year.

Take into consideration the case of Carol Zerkle and Barbra Holycross who were involved in a court case in Ohio over Michael Holycross’s life insurance benefit. Michael was married to Carol from 1972 through 1993, when they divorced. In 1997, Michael married Barbra and they remained married until his death in 2003.

Michael had designated Carol as his life insurance beneficiary when they married in the 70s and it was never addressed in the divorce settlement in the 90s. Michael never updated his policy to include wife Barbra, probably assuming it would automatically be granted to his wife, not his former wife.

While the probate court heard Barbra’s complaint, they rules in Carol’s favor, citing two rulings. While one ruling spoke specifically to a spouse’s rights over an ex-spouse to death benefits (in Barbra’s favor), another specifically stated that the ruling could not be applied retroactively to insurance policies dating before 1990. After exhausting all appeals, Barbra was excluded from any claim to Michael’s life insurance benefit. Don’t let this happen to your loved one.

Updating your Beneficiary
Avoid the unfortunate situation Barbra found herself in by updating your life insurance beneficiary regularly. Start by dusting off your original insurance policy documents. Don’t remember the name of the insurance company? Try calling the insurance agent. If you purchased the policy through an employer, call their human resources department.

Contact your insurance company to request a change of beneficiary form. Every insurance company chooses their own form and steps to take in order to change the benefactor of their policies.

Complete the form, including finding witnesses and a notary public, if required. Most banks offer notary services for free or just a few dollars if you are an account holder. Office supply stores, shipping shops and some post offices offer notary services as well. Do NOT sign the form until you are instructed to by the notary, if a notary stamp is required.

Make a copy of the form before you submit it. You may have to send in the form by registered mail, you may be able to simply fax it in. Again, contact your insurer to find out how they prefer to receive your change of beneficiary form.

Confirm your insurance company has received and processed your request about a month after submitting it.

Keep a copy of all your insurance policies, wills and final wishes in a single file. Let your beneficiaries or estate delegate know where the file is and discuss your wishes.