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socrateaser, Attorney
Category: Business Law
Satisfied Customers: 37808
Experience:  Retired (mostly)
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I took a life Insurance policy out on my wife (who is presently

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I took a life Insurance policy out on my wife (who is presently in Iraq) in 2005. I went to MyPay website to view my military pension pay. Under "allotments" it now lists her as the beneficiary of the policy. No one can be the beneficiary of their own death. I called the insurance company. It was an apparent mistake. Therefore I paid for a product I did not get for for 5 years, and what would have happen if she died being listed as the beneficiary? Would I get paid? Do I have a lawsuit or grounds for reinbursement with interest? BTW, the company was not happy that MyPay lists beneficiary. The rep put on hold to get a supervisor when I mention the word "litigation" until I hung up 15 min later.
Submitted: 6 years ago.
Category: Business Law
Expert:  socrateaser replied 6 years ago.

If the beneficiary was the insured, then the benefit would be distributed to the beneficiary's estate, and as spouse, you would receive some or all of the benefit, based upon whether there are surviving children who are not issue of your marriage, and/or surviving parents.


Basically, you would get a minimum of 1/3 of the insurance proceeds, and a maximum of 100%.


You would have had a claim of negligence against the insurer, if your spouse had actually died, and you did not receive 100% of the benefit. It is fundamental in a negligence action that you cannot obtain compensation for damages that you did not actually suffer.


Therefore, if you have fixed the beneficiary designation now, and your spouse did not die, then you have no claim.


Hope this helps.


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Customer: replied 6 years ago.
TY, I will accept the answer. One more thing please. The policy was sent to my spouse, not me. So I do not have the product I bought. The Insurance company told me that even though I'm paying for the policy, my spouse owns the policy because she is the insured. They also told me that she would have to make the change of beneficiary back to me. But, how can that be if I put myself as the beneficiary on the original application? Can the insurance company make that change themself and later call it a mistake? This is all rather confusing to me.
Expert:  socrateaser replied 6 years ago.

The problem is that once your spouse became the owner, any change to the policy is her sole right to make.The fact that she did not change the policy since issuance, could be evidence of her intent to keep the policy in that form. The insurance company is balancing its risk. If it makes the change and your spouse doesn't like it, then she can sue for interference with the property. If the insurer doesn't make the change and you are injured upon your spouse's deah, then you can sue for negligence.


Apparently, the insurer views its risk greater with your spouse than with you -- otherwise, it would change the policy.



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