Court Rules against Ex Wife's claim to life insurance proceeds

In Branch v. Monumental Life insurance Company, the Houston 14th Court of Appeals considered the claim of an ex-wife to life insurance proceeds.  The court of appeals affirmed the Brazoria County court's ruling that she was not entitled to the proceeds.

Archie Branch bought a life insurance policy during his marriage to Loretta Branch.  He named Loretta as the sole beneficiary.They were then divorced. Archie died six weeks after the divorce was final.

Loretta claimed the life insurance proceeds.  The life insurance company decided not to pay when it learned of the divorce. It filed an interpleader lawsuit, naming Loretta and Archie's children as defendants and interested parties.

Loretta contended she was entitled to the proceeds as the  designated beneficiary. The court noted in response:

By statute, if an insured’s spouse is designated as a life-insurance
beneficiary but the couple later divorces or their marriage is annulled, the earlier
designation of the spouse as a policy beneficiary is ineffective. See TEX. FAM.
CODE ANN. § 9.301(a) (West 2006). If that happens, then the policy proceeds are
payable to the named alternative beneficiary, or if there is none, then the proceeds
are payable to the insured’s estate. Id. § 9.301(b). The same statute provides three
exceptions to this rule. The earlier designation of a former spouse as a lifeinsurance
beneficiary is not rendered ineffective if (1) the former spouse is
designated as the beneficiary in the divorce decree; (2) the insured redesignates the
former spouse as a beneficiary after the divorce; or (3) the former spouse is
designated to receive the insurance proceeds in trust for, on behalf of, or for the
benefit of a child or a dependent of either of the former spouses. Id. § 9.301(a).

Loretta responded that she was entitled to the proceeds because she paid the policy premiums. The court rejected this argument. The divorce decree awarded ownership of the policy to Archie. Loretta failed to prove that her circumstance met any of the exceptions set out in the Texas Family Code regarding the effect of divorce upon life insurance designations. She did not get the money.  Instead it went to Archie's lawful heirs. 

There are ways to address the claims of an ex spouse that may be successful in obtaining life insurance proceeds.  It is extremely important to consult an experienced Texas life insurance attorney in that situation.