Caution: If any of these contracts lack a valid death beneficiary designation, the contract will most likely provide that the proceeds will be paid to the Decedent’s estate, converting what was thought to be a nonprobate asset into a probate asset, making it subject to probate. Furthermore, even if the pertinent contract has a valid death beneficiary designation, if that beneficiary fails to survive the Decedent (eg, as a result of a simultaneous death), that beneficiary will be considered to have predeceased the Decedent, and if no contingent death beneficiary is named and has survived, the proceeds will most likely be paid to the Decedent’s estate. Consequently, you should provide a list of contingent death beneficiaries on any contract having a death beneficiary designation.
Besides POD Accounts and TOD Securities, other assets may have death beneficiary designations and provide for the possibility of their passing outside of probate, such as:
Caution: Analogous with community joint tenancy assets, each spouse owning a community life insurance policy has the right to designate the disposition of only one-half of its proceeds without the other spouse’s consent. Francis v. Francis, 89 Wn.2d 511 (1978); Minnesota Mutual Life Insur. Co. v. Ensley, 174 F.3d 977 (9th Cir., Cal, 1999).