Once a property settlement is entered by the court as part of a final divorce decree, most former spouses part ways with no shared assets. The will of each former spouse is often changed to remove the other spouse as an heir. However, in Missouri and across the country, some people neglect to make changes to the existing beneficiary designations in certain types of accounts, sometimes resulting in these assets being transferred to the former spouse unintentionally.
For example, life insurance policies and retirement accounts generally have beneficiary designations. Significant amounts of money may be deposited in transfer on death bank accounts. Generally, a beneficiary designation in any of these assets will take precedence over the contrary provisions of a will. If a former spouse were to die having made a new will leaving all of his or her possessions to others but without having changed the beneficiary designations on insurance policies and retirement accounts, the designation of the former spouse will in most cases.
Some states have laws to prevent this unintended passing of assets. In some jurisdictions, a beneficiary designation in a life insurance policy in favor of the other spouse is revoked on the date that the marriage ends. The proceeds of the asset are treated as they would be if the spouse had never been designated a beneficiary. However, there are some exceptions.
Because of the varying treatment of non-probate beneficiary designations, a person who is contemplating ending a marriage may consider consulting with an attorney who has experience with divorce legal issues. It may be possible to negotiate a comprehensive settlement agreement that addresses these and other important matters.