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How does divorce affect life insurance in Minnesota?

Many marital and legal obligations for couples are dissolved in a Minnesota divorce. However, divorce may not automatically extinguish some agreements and responsibilities incurred before the dissolution of the marriage unless state law terminates a specific obligation.

For example, a Minnesota divorce legally ends all rights of a person to receive property in a spouse's will executed before the divorce. The law treats the beneficiary spouse as if they predeceased the testator.

Likewise, a Minnesota law enacted in 2002 revokes the designation, made during the marriage, of a spouse as beneficiary of any life insurance policies. To achieve this, the law treats the surviving ex-spouse as if they predeceased the insured.

The surviving ex-spouse is not entitled to beneficiary benefits even if the policy was executed before the 2002 enactment of this law. This law also overrides an earlier state Supreme Court ruling that marriage dissolution did not revoke any beneficiary designation made to the individual's former spouse.

Divorce decrees, however, can limit a spouse's right to change beneficiaries under a life insurance policy. In other words, a spouse may have to keep a former spouse as an insurance beneficiary if the divorce decree contains this requirement.

The state Court of Appeals issued an unreported opinion in 2013 addressing a will that was executed before the parties' divorce. The ex-husband was the named beneficiary while the ex-wife's estate was the contingent beneficiary. Although the insured ex-spouse had the authority to change her beneficiaries, she never did so. The Court ruled that her estate was entitled to the life insurance proceeds because her husband lost his status as a beneficiary when the couple divorced.

An experienced family law attorney can help protect the legal rights of a spouse in divorce proceedings. A lawyer can provide valuable advice regarding life insurance and other property issues that may arise in divorce proceedings.

Source: Minnesota Law Library Archive, "In Re: Life Insurance Policy No. 1642947-2, No. A13-0824 (Minn. Ct. App. Jan. 13, 2013)(Unpublished)," Accessed Jan. 24, 2016

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