Some events that could create contested benefits include:

1. all or some of the beneficiaries are deceased possibly creating ambiguity about who was intended to get the money. For example, several children of an insured are named equally as beneficiaries. Then, one or more of these beneficiaries becomes deceased, but they have children of their own. Should those children receive the deceased beneficiaries’ shares?

2. some, but not all, children of an insured are named as beneficiaries. The remaining children claim that their names were left off through oversight because they were born after the last beneficiary designation.

3. legal complications, as when the designated beneficiary is accused of killing the insured.

The insurance company will usually try to determine who should receive the proceeds in situations like these. If this cannot be done, it will hold the proceeds until the proper legal authorities can make the decision for them.

Such problems can often be avoided by regular review and revision of beneficiary designations.