What if the person who is the named beneficiary of a life insurance policy, intentionally caused the death of the insured? Who gets the money?
Pursuant to the 1987, Texas Supreme Court opinion, Crawford v. Coleman, a beneficiary who willfully participates in bringing about the insured’s death, either as a principal or as an accomplice, forfeits any right to benefits. The benefits are payable to any innocent contingent beneficiary or to the insured’s nearest relative.
Sandra Shoaf was stabbed to death by her husband, Cornelius Shoaf. Sandra’s life was insured under four insurance policies, each designating Cornelius as the primary beneficiary. The trial court disqualified Cornelius from receiving Sandra’s death benefits because the jury found that Cornelius willfully caused Sandra’s death.
This situation is governed by Texas Insurance Code, Section 887.205.
From the 1894, Texas Supreme Court opinion, Cheeves v. Anders, it is well settled that a life insurance beneficiary must have an insurable interest in the insured’s life.
The basis for the rule is two-fold: no one should have a financial inducement to take the life of another; and a life insurance policy for the benefit of one without an insurable interest is a wagering contract.
It is strange how often the “Slayer’s Rule” comes into play in situations involving life insurance. The statute dealing with the Slayer’s Rule is Texas Insurance Code, Section 1103.151.