IRA And Life Insurance Beneficiaries

California, like many states, abides by the contractual beneficiary designation made on your IRA and life insurance. When you designate a specific beneficiary, then the property will go to that person without probate.

Sometimes, however, the beneficiary you designate may not be the actual person you wish to receive the IRA or life insurance. In one particular situation, a woman designated her sister as the beneficiary before the woman was married and never changed the beneficiary designation to name her husband after she was married. As a result, when the husband tried to claim the money, neither the IRA administrator nor the insurance company would pay him since he was not the designated beneficiary despite more than two decades of marriage. Here’s the story.

Similarly, if an IRA or insurance beneficiary is named and dies before the IRA owner or the insured, and if there is no secondary beneficiary named, then those assets must go through a probate in California before the money is distributed. So, when certain items of property ordinarily avoid probate because the law of contracts usually applies, California probate is required when the beneficiary designation no longer works.

Avoid probate in California. Consult with an estate planning attorney – call Mitchell A. Port at (310) 559-5259.