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Question for the Money Doctors

Question submitted on May 12, 2013.


Can a policy holder of life insurance change the beneficiaries when an insured has died?

My mother died on March 16th of this year. My grandfather has life insurance for my mother and I (34 y/o) am the beneficiary for both my mother and grandfather. From what I gather, my grandfather is the policy owner, my mother is the insured, and I am the beneficiary (don''t know if I am primary or contingent).
Anyway, my grandfather told me I need to sign some papers because I''m the only one that can sign for the proceeds. And, since he has been the only one paying life insurance for more than 20 years he will keep the proceeds to fix his house, he will also get $8,000 of it because he spent that amount on legal fees for one of his grandchildren''s lawyers, and he will also take whatever amount for the funeral expenses that my mothers'' older and only surviving sister (Connie) spent when she decided to pay for the funeral expenses her self. (I had no say in my mothers funeral arrangements, since I wasn''t the one paying for it. Well, that is how my grandmother put it). Now, according to my grandfather, from the proceeds I have to pay Connie for every penny she spent on funeral arrangements. I was never aware of this agreement. If I knew I would have to pay Connie back, I would have had some say in my mothers funeral arrangements. (I tried throwing out ideas on less expensive arrangements but I wasn''t acknowledged). I also have to pay for my mothers headstone, which will also be my headstone, since the burial plots are paid for. (I will be buried in a double depth plot with my mother). Also, my mother has no estate and that is the reason I have to pay for expenses out of the proceeds. To add, I am the only daughter and grand daughter that has to pay for their parents funeral expenses, my own headstone, and grandfathers expenses out of the proceeds, since it can''t come out of her estate since there is none. So, when my grandparents die, his only surviving daughter (Connie), and every grandchild get to keep their proceeds. Also, when Connie dies, her children get to keep all their proceeds because both my grandparents and aunt have estates. I''m baffled. It seems unfair. I feel betrayed, bullied, and lied to. My grandfather called to tell me I need to sign these papers today. And he, my grandmother, my aunt (connie), and myself need to sit down and talk about the proceeds being distributed evenly amongst all four of us. Hence my question about policy changes. I hope this is not confusing. I need help. I don''t know that to do. Please shed some light on this horrible situation.


You should receive the proceeds as the beneficary from what you say here. I would not sign anything until you see the policy.There is the need to review the policy in some detail to give a better answer. I advise getting a copy of the policy and chatting with the insurance company that wrote the policy and talking to your own insurance agent.

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