Life Insurance – Named Beneficiary

Are there ways the named beneficiary of a life insurance policy can be defeated for the life insurance proceeds?  Rarely.
Here is a 1998 opinion wherein a wife contested the named beneficiary of a life insurance policy.  The opinion is from the Corpus Christi Court of Appeals and styled, Camp v. Camp.
The Husband purchased a life insurance policy as an employment benefit while he was still single and without children.  He named his mother beneficiary to the policy.  When he later married, he did not change the insurance policy’s beneficiary designation to his wife.  Premiums for the policy were paid from the husband’s employment earnings during the years of his marriage to wife until his death in 1996.
Wife filed a declaratory judgment action against the mother seeking a declaration as to the ownership of the life insurance policy.  The mother filed a motion for summary judgment which was granted.  The wife appealed.
Summary judgment in favor of mother was affirmed.  Because the husband acquired title to the insurance policy through his employment compensation prior to his marriage, and named his mother as a beneficiary, the insurance policy was his separate property and his wife was entitled to reimbursement only for her share of the premiums which were paid with community property funds.  There was no fraud against the community.  The fraud against the community arises from a spouse disposing of the other spouse’s interest in community property.  In this case, the premiums were paid from community funds, but the trial court awarded the wife reimbursement for her community interest in the policy premiums.
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