Is my mother or are my two brothers and I entitled to part of insurance money if deceased father was a co-beneficiary?.

Question

My father passed away one week before his brother.   The deceased brother , my uncle, had a life insurance policy that listed his three brothers ( including my father) as beneficiaries.  After his death one brother made claim and collected the insurance payout for himself and other living uncle.   Since my dad was a beneficiary shouldn’t his heirs (wife or children) have a portion?   The deceased uncle had no will.   My father had a will that left monetary assets to my mother.   We are confused why the insurance company did not notify us.

Anthony M. Avery · Answer

Insurance Carrier is not required to notify anyone.  If Father's Will was probated, then the Mother should have received 1/3 as beneficiary of the Estate of one of the designated beneficiaries.  She needs to file a claim with the insurance co., which I suggest be done by an attorney.    If no good response, she must sue for breach of contract the ins. co.. and the brothers that got the money for conversion.   The insurance contract may have venue and SOL terms.     It may not be worth the trouble.

Nina Whitehurst · Answer

This question demonstrates a problem with relying on beneficiary designations as an estate planning technique (yes, even for life insurance).  When more than one person is named as a death beneficiary, with nothing more, there is an ambiguity created as to what should happen if one of them predeceases the insured.  Did the owner intend for that share to lapse?  Or did he intend for that share to be distributed to the deceased beneficiary's estate?  Sometimes the beneficiary designation forms do not have a place or mechanism for clarifying that, and this is the result.   
 
The starting point for resolving this apparent ambiguity is to obtain a copy of the actual death beneficiary designation that the policy owner signed.

Q: Is my mother or are my two brothers and I entitled to part of insurance money if deceased father was a co-beneficiary?.