Shabbat Parashat Shoftim 5776

P'ninat Mishpat: The Rightful Beneficiary of a Life Insurance Policy

Case: The plaintiff (=pl) is listed in his deceased brother’s life insurance policy as the beneficiary and wants to receive its benefits. The defendant (=def), the deceased’s son and inheritor, argues that it is not logical that his father would purposely leave pl as the beneficiary, considering the very strained relationship that existed between the two in the final years of his life. Previously, the two were partners and had a good relationship, until mutual complaints led to the dissolution of the partnership. The policy was opened two decades previously, when def was five-years old. 

Ruling: It is not clear why the deceased wrote his brother as the beneficiary of the insurance policy even though he had a wife (it is not clear how strong that relationship was) and a son. It is possible that he did so in return for some benefit that he received from pl or for some other reason. It is hard to change, based on circumstantial evidence, that which is written explicitly in a legal document.

Def provided an audio tape discussion of the deceased in which the insurance policy was mentioned. Two things are clear from it: 1. The deceased remembered that pl was the beneficiary of the policy. 2. He did not change his mind before his death. Therefore, the question is how to view the halachic status of a life insurance policy.

There are two ways to view the benefit payments an insurance company pays. One is that upon receiving premium payments, the company obligates itself to pay according to the instructions it is left. In that case, there is, in a case like this, no room for a court to intervene in the determination of beneficiaries. It is whoever the instructions specify. A second possibility is that the money is considered the insured person’s monetary rights during his lifetime, which is to be dispersed by the insurer under certain circumstances. According to this second possibility, the deceased’s instructions are under the halachic category of “it is a mitzva to fulfill the words of the deceased,” whose rules we must take a look at.

The Shulchan Aruch (Choshen Mishpat 252:2) says that it is a mitzva to follow the words of the deceased even if he was healthy when he left instructions, as long as he gave it to a third person to hold for that reason. The K’tzot Hachoshen (252:3) rules that this is an obligation that the inheritors can be forced to carry out. Most poskim rule that this is the case even if the money is presently in the hands of the inheritors (see Shulchan Aruch, CM 250:23). In the case of an insurance policy, the company is the third party, and so they have the obligation to give the benefits to pl, and beit din has no reason to intervene to prevent this even according to the second approach above.

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