In one case that Long has used in his law classes, a retired military officer's life was shortened considerably by the "benign neglect" of his "spiteful, vindictive . . . and stingy" sister, who was supposed to be caring for the ailing colonel after his wife died. Although a court in Washington, D.C., found in 1995 that the mean sister "possibly hastened" the colonel's death, Long says, it also concluded that her actions weren't willful and she was allowed to collect the life insurance money.
This court decision did not please the life insurance industry, Long says.
"Insurance companies are reluctant to honor policies when there has been what we would consider to be obviously neglectful -- much less than intentional or willing -- conduct towards the deceased," Long says.
Sorting out the beneficiaries
So what happens to the life insurance money when a murderous beneficiary is barred from collecting it?
According to Dolan, the money in those cases will go to a "contingent beneficiary," such as a child or a relative, named in the life insurance policy. In cases where there are no contingent beneficiaries -- or if those beneficiaries were also part of the murder plot -- the insurance company usually asks a court to decide who gets the death benefit, Dolan says.
Courts get involved in other ways as well. In the case of the Indiana vacuum-cleaner salesman, the deceased's father went to court to block the insurance company from paying the man's wife, before she was charged or convicted in the death. In another case, also in Indiana, a wife suspected of killing her husband for the life insurance benefit was required by a judge to use the $40,000 settlement to help pay for her public defender.
This article was reported by Jim Sloan for Insure.com.
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