Guest post by Lisa M. Cukier, Esq., Partner at Burns & Levinson LLP. Ms. Cukier concentrates her practice in all aspects of probate litigation, fiduciary litigation, planning & litigation for blended families, same-sex couples, guardianship, conservatorship, mental health law, elder law and domestic relations.
You are divorced… but wait, if you unexpectedly pass away, does your ex still have rights to your estate?
One spouse’s waiver, in a divorce or separation agreement, of an interest in beneficiary designations is not sufficient to bind the plan administrator, who is obligated to distribute the funds according to the beneficiary designation, even if the parties are divorced at the time of death. In fact, a spouse’s waiver of her or his interest in the other’s life insurance or retirement plan or assets designated as “TOD” (“Transfer On Death”), which assets are retained in the division of property in the divorce, will likely be ineffective. On the death of the person who made the beneficiary designation, the former spouse will receive the death benefit. You must take the additional step of revoking or changing the designation of your former spouse as beneficiary of such accounts, assets, and plans.
Although a divorce may not automatically change a beneficiary designation with respect to life insurance policies and retirement accounts, divorce will alter your Will. The law recognizes that after a divorce, most people do not want to leave their former spouse any of their assets by Will. Thus, the law currently states that a divorce will effectively “revoke any disposition or appointment of property made by the will to the former spouse.” At your death, and absent any provision to the contrary, any property designated in your will that is supposed to pass to your former spouse will instead pass on as if the former spouse failed to survive you.