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Divorce Decree Must Describe Life Insurance with Sufficient Specificity

Divorce Decree Must Describe Life Insurance with Sufficient Specificity

Unum Life Ins. Co. of Am. v. Sides, 2014 WL 1207616 (N.D. Ga. Mar. 21, 2014)

ERISA and Life Insurance News
(August 29, 2014)

Unum Life filed an interpleader action, seeking a judicial determination of the rightful recipient(s) of the death benefit payable under a policy insuring the life of Christopher Sides.  Sides had previously been married to Casey Sides, who was the mother of his two minor children.  In their divorce settlement agreement, Sides and his former wife each agreed to maintain insurance on his or her life of at least $250,000 with the minor children named as beneficiaries and the other parent named as trustee.

At the time of the divorce, the only life insurance Sides had in place was coverage under a group policy issued by Unum Life to his employer providing coverage in the amount of his annual earnings, which was far less than $250,000.  When Sides later married Brooke Sides, he executed a change of beneficiary form designating her as the beneficiary of his life insurance under the Unum Life policy.

Sides died of cardiac arrest in 2012, and Unum Life filed the interpleader action because both Brooke Sides and Casey Sides (as guardian of the minor children) claimed entitlement to the life insurance proceeds.  Casey claimed that the court should impose a constructive trust on the proceeds because Brooke would be unjustly enriched if allowed to keep the death benefit.

The court disagreed because, although Georgia law supports a vested interest in life insurance when a divorce decree identifies a specific policy, the Unum Life policy was not specifically identified.  Thus, Brooke was entitled to the proceeds of the life insurance policy.  The court mentioned in dicta that Casey may have a claim against the estate of Sides for his failure to maintain $250,000 in life insurance for his children pursuant to the divorce decree.

Click here to view the full August 2014 Edition of the ERISA and Life Insurance News.

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