Articles Posted in Life Insurance

Life Insurance Lawyers in the Dallas and Fort Worth area will see situations on a regular basis where the person who died had a life insurance policy naming the other spouse as the beneficiary – but there was a divorce later and the policy naming the ex-spouse was never changed.  What to do?  This is discuss in a National Review article titled, Divorces Can Be Messy … For Life Insurers.

Divorces are often characterized as “messy” for good reason.  While divorce proceedings can prove particularly challenging for the individual participants, they can also pose challenges for those adjudicating competing life insurance claims when the decedent insured’s ex-spouse, who has been designated as a policy beneficiary, claims a right to the death benefit instead of the surviving spouse, the insured’s estate or a secondary beneficiary.

Divorce-related life insurance disputes can end up before courts in litigation over the decedent insured’s estate, in litigation brought by a purported beneficiary against the insurance company, or in inter-pleader actions filed by the insurer.  In an inter-pleader action, the insurance company files a petition with the court seeking an order determining, for instance, which spouse – surviving or ex – is entitled to the decedent insured’s policy proceeds following a divorce.

It’s bad enough when private insurance companies mistreat life insurance beneficiaries but an April 2017, story from the Chicago Tribune shows that the U.S. Government does the same thing.  The story is titled, USPS Agrees To $49 Million Settlement For ‘Dawdling” In Paying Life Insurance Beneficiaries.

It’s bad enough for family members when a loved one dies.

Getting cheated by Uncle Sam afterward makes it worse.

Life insurance lawyers know about Texas Insurance Code, Section 1103.151.  Also known as the Texas Slayer Statute, it states:

A beneficiary of a life insurance policy or contract forfeits the beneficiary’s interest in the policy or contract if the beneficiary is a principle or an accomplice in wilfully bringing about the death of the insured.

Section 1103.152, goes on to say the proceeds of the policy go to the contingent beneficiary if there is one or goes goes to the estate if there is not.

Irving life insurance lawyers need to know every little aspect of the law in order to properly represent their clients.  A 1996, San Antonio Court of Appeals opinion deals with one of these “little” aspects of the law.  The opinion is styled, Mendoza v. American National Insurance Company.

Jerry Mendoza purchased a $25,000.00 life insurance policy from American on August 1, 1991.  The October premium was not paid.  The policy provided for a 31 day grace period.  On November 1, 1991, the last day of the grace period, American’s district manager, Sitka, verbally agreed to extend the grace period until November 4, 1991.  The policy, however, specifically provided that only American’s president, vice president, or secretary had the authority to extend this time period.  Jerry Mendoza died in an automobile accident on November 3, 1991.  The premium was never paid.  In a prior appeal, this Court affirmed a summary judgment in favor of American on Plaintiff’s breach of contract, negligence and bad faith claims.  This appeal concerns the trail court’s granting of summary judgment on Plaintiffs’ claims for intentional infliction of emotional distress, Insurance Code and DTPA violations.

The Court held that in order to qualify as a consumer under the DTPA, a person must seek to acquire goods or services by purchase or lease and those goods or services must form the basis of the complaint.  Lack of privity between plaintiff and defendant does not preclude a plaintiff from establishing status.  Section 541.060 provides standing to “any person” who has been injured by another’s engaging in an unfair or deceptive act or practice in the business of insurance as declared in the Insurance Code; rules and regulations issued under the Insurance Code or Section 17.46 of the DTPA.  Therefore, a plaintiff may assert causes of action under the Insurance Code for violations of Section 17.46 of the DTPA even though the plaintiff is not a “consumer.”  Carrion, a named beneficiary of the policy, would clearly be injured as a result of Sitka’s alleged misrepresentations.  Therefore, Clarion has standing under the Insurance Code.  Mendoza’a mother, in her capacity as representative of the the estate, however, does not have standing to assert Insurance Code or DTPA claims because those claims do not survive Mendoza’s death and his mother is not a “consumer” in her own right.

Granbury life insurance lawyers need to read this 1975, Texas Supreme Court opinion.  It is styled, Johnson v. Prudential Insurance Company of America.

This is a suit to collect benefits under a group life insurance policy.  Prudential resisted payment based on their assertion that the deceased willfully deceived the company by her statements made in procuring coverage.  The beneficiary contends that the statements of the insured were inadmissible and could not be considered because copies of the application were not furnished to the insured in compliance with what is now the Texas Insurance Code, Section 705.103.

Ten years before applying for this insurance, Mrs. Johnson, the insured, had her right breast removed because of cancer.  Mrs. Johnson made what she could have regarded as true statements, but they were incomplete and misleading.

The Galveston Court of Appeals issued an opinion in 1938 that is still good law.  The case is styled, Texas State Life Insurance Company v. Freeman Barton.

This is an appeal from a trial to the Judge wherein Texas State was ordered to pay the life insurance proceeds to the beneficiary together with the statutory penalty and attorney fees.

The policy had been issued on Marie Clemons on July 10, 1935, with Barton as beneficiary and Marie having died on November 29, 1935.  (As a side note, this case points out “both of them being negroes,” – makes you wonder about that time in history).