Supreme Court Upholds Life Insurance Law

After a couple divorces, estate law typically assumes that neither of the ex-spouses wants the other to receive any death benefits. If someone has left a lot of property in a will that was written prior to the divorce to that now ex-spouse, probate courts will constructively rewrite the will to exclude the ex-spouse. However, life insurance operates outside of the probate court system.

The default has always been that whoever is the policy beneficiary at the time of death, gets the benefits, even if it is an ex-spouse. Some states have written laws that say ex-spouses should be excluded. The Supreme Court recently ruled on such a state law, as SCOTUSblog discusses in “Court rejects a constitutional challenge to state law on life insurance policies.”

In the case, a Minnesota man took out a life insurance policy to benefit his then spouse and children. The couple divorced but the man did not change the policy beneficiary. Minnesota later passed a law removing ex-spouses from the policies.

The man passed away and the ex-spouse sued to get the benefits, on the grounds that the law was in violation of the Constitution’s contract clause. The Supreme Court disagreed and upheld the law.

There are, of course, cases, where someone might want an ex-spouse to receive benefits. For that reason, it is important to know the laws in your state, so you can make changes to your estate plan after a divorce or any other important life event.

Reference: SCOTUSblog (June 11, 2018) “Court rejects a constitutional challenge to state law on life insurance policies.”

Hear From Our Clients

“On the threshold of retirement, we finally decided to quit thinking we could self-prepare the requisite documents. We had previously had only a very simple will. We needed the necessary legal (including updated will) & health care docs but didn’t want to deal with the time & complication of legalese. Cindy made the process relatively painless. She took the time to explain and answer questions without trying to upsell services. We were done in 2 meetings plus the reading of emailed drafts. In addition to preparing the documents, Nelson Eldercare will be there when our adult children need advice on executing the plans we’ve put in place.So glad it’s behind us and would recommend Cindy and her helpful staff.”

- Bonnie

Cindy and her company treat their clients like family. Nelson’s offers clear, direct, and honest guidance in planning for your families security and future. No one wants to actively sit down and make these decisions, but Nelson’s makes this process seamless. I was so impressed with their willingness to answer all questions big or small. So glad I made the decision have them help my mom and dad and now me. You can’t go wrong with Nelson’s Elder Care Law.

- Hope

The very best elder law attorney and staff anyone could ever ask for! I have referred a number of clients to Cindy and she never disappoints. She is kind, caring, and extremely thorough in making sure everything is completed as it should be. I highly recommend Cindy for anyone needing lawyer services; she truly goes above and beyond for every client she helps and has had a huge impact in so many peoples’ lives. Thank you, Cindy and staff, for everything that you do- I’m so glad to know you!

- Kerri

I heard Cindy’s presentation at a Senior Luncheon at my church, and was very impressed. She helped my daughter and me understand many aspects of elder law. Josh has also been very helpful in my planning to enter an independent living situation . I have told many friends about them.

- Charlotte

Cindy and the Nelson Elder Care Law team are trustworthy and helpful. They are the experts in elder care law. At Leaf Cremation, we entrust our families to the care of the Nelson team when their services are needed.

- Pierce