by Guest » Fri Oct 18, 2013 06:14 am
An elderly husband had an IRA Qualified Annuity Policy and was taking yearly payouts. The Policy had a Sole Beneficiary. The husband made out a Change of Beneficiary Form, naming his wife as Primary Beneficiary and naming his 3 children as Contingent Beneficiaries. The form was signed by him and by the insurance agent. The husband intended to send it to the Insurance Company himself, but laid it aside, and then forgot to do so. Instead, he filed that document with his important papers, alongside the Policy. Then the husband died. Although his intent was for his wife to inherit, the Insurance Company did not receive and process the change.
Is there any recourse for his wife?
Could the named Beneficiary theoretically decline benefits and if so what would become of the Policy?
Is there any recourse for his wife?
Could the named Beneficiary theoretically decline benefits and if so what would become of the Policy?
Posted: Fri Oct 18, 2013 08:14 am Post Subject:
Is there any recourse for his wife?
NO. He could have "laid it aside" as an afterthought, believing that he wasn't sure he really wanted to do that.
However, if the Annuity was an IRA, federal law may still give the surviving spouse an entitlement to the proceeds.
Posted: Fri Oct 18, 2013 07:11 pm Post Subject: Deceased husband's annuity beneficiary
Could the named Beneficiary theoretically decline benefits and if so what would become of the Policy?
Posted: Sat Oct 19, 2013 04:55 am Post Subject:
Under §2518 of the Internal Revenue Code, a person may make a qualified disclaimer with respect to property passing at death so long as (i) the disclaimer is in writing, (ii) the writing is received by the decedent's representative within nine months of the date of death, (iii) the disclaimant has not accepted the interest or any of its benefits prior to making the disclaimer, and (iv) as a result of the refusal, the interest passes without any direction on the part of the person making the disclaimer. Where a disclaimer is "qualified" under §2518, the disclaimant is not treated as having made a gift of the disclaimed property to the takers in default.
what would become of the Policy?
Technically, the policy ends with the death of the annuitant. At that point, the insurance company must follow the contractual obligation it has, if any, to a beneficiary. Some annuity payment options do not provide for continuing payments (as a lump sum or monthly/annual installments), and the insurance company retains the balance of the annuity's assets.The Internal Revenue Code also allows a surviving spouse, as beneficiary, the option to continue an annuity as his/her own.
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