If your life insurance policy named your spouse as beneficiary, Texas law will ignore this designation after your divorce, unless the divorce decree provides otherwise. Nevertheless, you always should review your beneficiary designations on your life insurance and your retirement plans, pensions, annuities and IRAs at the time of your divorce. It is important to coordinate your beneficiary designations with your estate planning documents to avoid potential tax and estate administration problems after your death and to make sure that any death benefits payable to a minor or incapacitated person are directed to a trust for that person’s benefit. Properly handled, this may avoid the need to create a guardianship.
Last updated on January 6, 2011 by Glenn Karisch