What happens of the beneficiary on a life insurance policy is deceased?

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What happens of the beneficiary on a life insurance policy is deceased?

Asked on January 9, 2014 under Insurance Law, North Carolina

Answers:

Gregory Abbott / Consumer Law Northwest

Answered 7 years ago | Contributor

It depends upon the wording of the beneficiary clause in the policy.  It either gets paid to the designated beneficiary's estate, to become part of the rest of the estate and distributed according to the terms of the Will or orders of the probate court OR it will just default to the next contingent beneficiary listed or, if none, to the estate of the deceased beneficiary.  It all depends upon the language in the policy and while Insurance companies, like everyone else, make occasional mistakes, they don't really care who they pay the money to, only that they pay it to the correct person so that they do not get sued and/or become liable themselves for the payout amount.  Thus they and their legal department are usually, almost always actually, right in who they pay it to, assuming that party jumps through the necessary paperwork hoops the insurance company will undoubtedly require - death certificate, proof you are who you say you are, claim forms, etc.


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