Who Recovers Life Insurance Benefits When The Beneficiary Is Responsible For The Death Of The Insured

Life insurance lawyers will be faced with the above question more times than would be imagined. Fortunately the question is answered in the Texas Insurance Code and in Federal law cases. One example is a case from the Northern District of Texas, Dallas Division. The opinion is styled, American National Insurance Company v. John Huckleberry et al.
American inter-pled policy benefits into the escrow of the court and named four defendants who have a potential claim to the proceeds. The primary beneficiary, John Huckleberry was convicted of the murder of the insured. The secondary beneficiary is a minor, Truett Jason Huckleberry, whom the policy designates as the secondary beneficiary, represented here by Stevens, his guardian and natural mother The court had to decide who was entitled to the insurance proceeds: the secondary beneficiary or the heirs at law of the insured?
Pursuant to Texas Insurance Code, Section 1103.151, The interest of a beneficiary in a life insurance policy or contract heretofore or hereafter issued shall be forfeited when the beneficiary is the principal or an accomplice in willfully bringing about the death of the insured.
As evidenced by the conviction for murder of the named beneficiary of the insured which is attached to the motion for summary judgment filed in this case. The named beneficiary has forfeited their rights under the policy.
Texas Insurance Code, Section 1103.152, provides that when a beneficiary in a life insurance policy has forfeited his entitlement to the insurance proceeds because of his participation in willfully bringing about the death of the insured, “the nearest relative of the insured shall receive said insurance.”
As shown by the undisputed facts, the named secondary beneficiary under the policy is Truett Jason Huckleberry, the stepson of the insured. Although named as the secondary beneficiary, Truett Jason Huckleberry is not “the nearest relative of the insured.” That person is Crawford, the mother of the insured. Hence, Section 1103.152, if construed literally, would support Crawford’s claim to the insurance proceeds. However, in the case, Deveroex v Nelson, a very similar factual setting the Texas Supreme Court held “… we would distribute the insurance proceeds to the nearest relative of the insured under Section 1103.152 only if all of the beneficiaries, primary and contingent, are disqualified from receiving such proceeds” and the case, Deveroex makes clear that in this case the child, as an innocent secondary beneficiary, has a claim to the proceeds superior to Crawford’s.