Divorce and Beneficiary Designations

If you are in the midst of a divorce, or if you are already divorced, it is important to review the beneficiary designations on your retirement accounts, life insurance policies, wills, etc. to avoid unintended consequences. The general rule is that if you unexpectedly pass away without updating your beneficiary designations after a divorce, the previous designation of your ex-spouse as a beneficiary will be ineffective unless one of the following is true: it is clear from the wording of the designation that the designation of your ex-spouse as your beneficiary was meant to survive the divorce; there is a court order requiring the designation; there is a written contract between the spouses requiring the designation; or the former spouse was designated after the divorce was finalized. 20 Pa.C.S. § 6111.2.

Beginning on May 2, 2023, divorce decrees issued in Pennsylvania will be required to include new language, specifying that parties must reaffirm or change the beneficiary status of their ex-spouses for life insurance policies, annuity contracts, pensions, profit sharing plans, or other “contractual arrangements.” Failure to reaffirm or change the beneficiary status of an ex-spouse may result in revocation of the beneficiary designation. The new language included in divorce decrees should serve as a reminder to divorcing spouses that they should update their beneficiary designations.

If you have questions about beneficiary designations after divorce, or you are interested in discussing your particular circumstances with an attorney, contact Tanner Law at 717-836-0471 to schedule a consultation.