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Order to be made non-revocable beneficiary on life insurance

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  • Order to be made non-revocable beneficiary on life insurance

    Exwife has asked for an order for her to be made the non-revocable beneficiary on my life insurance policy, to be used in trust for our 4 children of which she is custodial parent.

    Does anyone have any experience with fighting this?

    * I already have a family member (Jill) as the beneficiary to hold the money in trust for my kids if i die.
    * Would it help to show the court that this exwife (who is unemployed with no income) leads a well-to-do lifestyle from the child support she makes from the kids? She uses it to pay for a large country property complete with her own personal herd of horses and ponies, and her own personal petting zoo with piglets, sheep and a large pack of herding dogs (all fed and paid for with child support).
    * I have a phone recording of her from a past weekend where she says she will not drive the the kids to me until I send her child support money so she can get animal feed.
    * I have a past email from her telling my current beneficiary (Jill) that Jill is very responsible financially and always looks out for the kids best interests. (Exwife was trying to flatter Jill because she wanted Jill to cosign a loan for her)
    * She does not even buy new clothing or decent birthday presents for the kids because she has no money left after affording the petting zoo

    All in all there is really no reason for her to become the beneficiary of my life insurance. What "tests" will the judge use to decide on this claim?

  • #2
    That's an interesting question. Since support survives death I'd ben curious to know if your estate would be obligated to provide a lump sum amount for the remaining support or if a trust would provide it and any residual capital.

    I found this article, if you go down to the who should I name a trustee section they throw an answer http://http://www.lbwlawyers.com/publications/child-and-spousal-support-obligations-after-death/

    They say you can name anyone

    Besides naming an ex as beneficiary does not give the money to your kids but to her. You're better off with a trust that benefits your children. Your ex just doesn't want to have to deal with your family following your death as she fears there would be scrutiny on her spending.

    Comment


    • #3
      What does your separation agreement say you will do with respect to life insurance?

      - what relationship is Jill to the kids? If she's a close aunt, grandmother, you might kick that can;
      - no;
      - doesn't matter;
      - doesn't matter;
      - doesn't matter.

      Most of the life insurance requirement clauses don't make a lot of sense -- and I do hope you have a requirement in the separation agreement for your ex to carry reciprocal insurance to your benefit?

      I think most times, if the insurance is already in place, determining the beneficiary is of consequence, but frankly no judge can order someone to obtain further insurance -- you have to meet the requirements of the insurance company, they'll dictate their own requirements.

      Is this something you really need to argue about? You'll be dead, by the way, if it is ever invoked.
      Start a discussion, not a fire. Post with kindness.

      Comment


      • #4
        Why not make a trust (which you create) the beneficiary of your will, and make Jill and mom joint trustees? Any wills and estates lawyer can advise you on how to do this. That way, Jill would have some oversight over mom's spending of the trust funds on behalf of the kids, but mom would be able to access the money for daily expenses.

        The zoo of animals and the emails and phone calls are irrelevant, I think.

        Comment


        • #5
          I had read a suggested way around this that unfortunately my spouse didn't utilize with his ex.

          Check with your insurance provider whether you can simply name "all of my children", some allow you to do so (allowing for future family planning or unexpected additions). You then name each of the following irrevocable...
          80% - All of my children (if not, name each child "in trust" and divide the 80% equally amongst them - check trust rules with you provider)
          10% - Your ex (she's on there irrevocable, like they asked)
          10% - Your sister (this money will allow her to take care of your estate without taking any funds from the children. Also, it puts another adult on as irrevocable who is able to dispute any changes not in your/the children's best interest)
          Name your sister as trustee for the children, until they have completed their post-secondary education. This ensures that their share of the funds is earmarked for their education.

          I had wanted my spouse to do the same with his mother in the place of your sister (excluding me) and ensuring any additions to our family were equally cared for.

          Comment


          • #6
            Originally posted by thebookworm View Post
            * I have a phone recording of her from a past weekend where she says she will not drive the the kids to me until I send her child support money so she can get animal feed.
            Just a side note - from my recent reading (and check with your lawyer of course) and to quote another legal site..."a parent denying access for anything other than safety concerns can get that parent into trouble with the court. Child support and access are separate issues."

            Comment


            • #7
              * I have a phone recording of her from a past weekend where she says she will not drive the the kids to me until I send her child support money so she can get animal feed.
              There is a rebuttable presumption that a parent will use child support for the children. It is possible that if a parent openly admits they do not spend the child support on the children (do the kids play with the animals in the petting zoo?) to have support cut. I've read it in the case of a hockey player and his ex-puck bunny

              Comment


              • #8
                From my understanding, this clause is actually fairly standard. The idea is that the life insurance is to cover your child support obligations and S7 expenses (including post secondary) if you should pass away.

                The irrevocable part is to prevent it from being messed with in the event of disagreements. Mine states that I must maintain the insurance for as long as CS is payable, although mine is not irrevocable. I can also ask to have it periodically reduced to reflect the remaining years of my CS, and I have already managed to have it reduced once after some doing reasonable kitchen table math about how much CS/S7 should cost.

                I also agonized a bit about putting my ex as the trustee but was advised by my lawyer that it was probably for the best. Imagine the situation where my ex is constantly nagging my parents for money (if they were trustees instead). That's really not fair for them and creates additional barriers for my son to have his needs met.

                If your ex has been trusted to be the primary caregiver in every other way, and she would have had control of all that money as monthly CS anyways, it doesn't make a lot of sense to not let her manage it for the kids.

                Comment

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