When one secures a life insurance policy, he or she usually does so for the best interest of the people closest to them. It could be a spouse, kids, siblings, grandchildren, or other individuals. Whatever the case may be, the insured might meet major life changes along the way, thereby ending up protecting the wrong individuals financially.
For instance, in the case of a divorce and the insured gets remarried, the current spouse is not privileged to the life insurance policy if the insured forgot to update the details of the beneficiary notes in the policy document. In other instances, the policyholder might have been coerced into including one or more beneficiaries, giving room for the contest.
Out of the many circumstances warranting the challenging of a life insurance beneficiary, key things to note include:
- Formally and urgently alert the insurance company of a challenge to the beneficiary in writing
Challenging life insurance is a time-sensitive issue. Therefore, to avoid complications related to who ultimately earns the proceeds of the policy, it is critical that the plaintiff officially and urgently inform the insurance company of his or her intentions. The advantage that comes with filing a formal dispute with the insurer is that they will hand over the benefits of the policy to a trust court until the case against the incumbent beneficiary is solved.
- Respond to the interpleader action within the specified period
When contesting a life insurance beneficiary, there is the possibility that you might receive an interpleader action. Being a time-sensitive issue, you need to serve the court with all the necessary documents within the time frame specified in the notice. Due to the technicalities involved in responding to interpleader actions, an attorney can proficiently assist a plaintiff in presenting his or her reasons for challenging the policy.
- Weigh whether it is necessary to challenge the beneficiary through trial or settling
Sometimes, the costs of challenging a life insurance beneficiary through full litigation might surpass the value of the proceeds of the policy. Under such circumstances, it is only logical to consider mediation. Still, an attorney comes in handy; as he or she will ensure that you significantly gain from the policy under challenge.
- Evidence is critical
Just like any other case presented before a Court of Law, the judgment ultimately delivered by the jury is based on the evidence presented before them. To strengthen your submissions, you, therefore, have to gather substantial evidence to support the case. If fraud were involved in deciding the policy’s beneficiary, it would be necessary to solicit potential witnesses to prove your point. On a different note, there other statutory entities such as the court’s registry and registrar of persons could provide you with supporting information.
- The State Laws might be in or against your favour
Finally, depending on the state you live in, the state laws could actually work for or against the case you are presenting. It is, therefore, important that you acquaint yourself with what these laws recommend so that you have a clue of how to file the litigation.