In most cases, no, life insurance proceeds are not subject to estate debts. The most common exception is when the “estate” is a listed beneficiary (which is improper under Texas law, but that’s a discussion for another day.) In most cases, life insurance is a contract between the insured and the life insurance company, to pay benefits to a beneficiary. The deceased person’s estate (to which most debts attach) is not involved in the process. The notable exceptions are life insurance policies specifically geared towards credits. A common example is a credit life policy. In this policy, an insured purchases a policy to cover a specific debt, such as a mortgage. This way, should the insured die, the mortgage is paid off in full.
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Insurance Law, Wrongful death and probate
Yes. A life insurance applicant may appoint anyone (or any entity) as a beneficiary on a life insurance policy, even a common law spouse. Also, if a common law marriage was in existence, then a common law spouse may have community property interests in a life insurance policy (purchased after the marriage) if the spouse is not listed as a beneficiary.
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Insurance Law, Wrongful death and probate
common law marriage, fraud, life insurance, life insurance litigation
Yes. However, the burden of proof shifts after the second anniversary of the death of the purported spouse. If successfully proven, the date of the inception of the common law marriage may be determined by the court.
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Insurance Law, Wrongful death and probate
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A common law marriage in Texas, if proven, carries the same validity as a ceremonial marriage. Accordingly, if there is a proven common law marriage, then the Texas rules regarding life insurance beneficiaries would apply.
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Insurance Law, Wrongful death and probate
