Cook v. Equitable Life Assurance Society
428 N.E.2d 110 (1981)
Douglas bought a life
insurance policy with Equitable Life and named his wife Doris as the
beneficiary. Then he got a divorce.
The divorce agreement made
no mention of the insurance policy.
Douglas stopped making
payments on the insurance policy. Equitable notified him that the policy
was being converted to a paid-up term policy with an expiration date 30
years in the future.
The notification mentioned
that Douglas retained the right to change the beneficiary with written
Douglas went on to marry
Margaret and have a kid named Daniel.
Douglas wrote a holographic
will that left the insurance policy to
Margaret and Daniel.
However, he never bothered
to write to Equitable and change the beneficiary.
Douglas died. Margaret filed
a claim with Equitable for the money from the policy. Equitable went to
court in an interpleader action to determine who to give the money to.
The Trial Court found that the
money should go to Doris. Margaret appealed.
As far as the Trial Court
was concerned, the contract on file with Equitable clearly indicated that
Doris was still the beneficiary.
The Appellate Court affirmed.
argued that the will was a valid attempt to change the provisions of the
The Appellate Court found
that strict compliance was not required to change the beneficiary, but
Douglas had taken no actions at all.
The Appellate Court
sympathized with Margaret, but found that there was good public policy in
providing certainty to beneficiaries and insurance companies about who
should get the money.
They also noted that if
Margaret had been vigilant and noticed the problem prior to Douglas'
death, it would have been easy to fix.
contracts (aka will substitutes)
take precedence over wills, and wills take precedence over intestate
So the basic rule is that if
you have a valid will and a valid insurance policy, the beneficiary
listed on the insurance policy trumps the beneficiary listed in the will.
Under the Uniform Probate
Code (which was not in effect when
this case was decided), divorce revokes by operation of law
not only wills, but also will substitutes.
If the Uniform Probate
Code had been in effect, Doris' name
(as well as her relatives) would have been stricken from the insurance
policy and the now beneficiary-less policy would have reverted to Douglas'