Cook v. Equitable Life Assurance Society

Brief Fact Summary. Douglas Cook named the appellant, Doris Cook, the beneficiary of his life insurance policy. When he divorced, he executed a will leaving his insurance policy benefits to his new wife. However Cook failed to notify the insurance holder that he wanted to change the beneficiary of his policy.

Synopsis of Rule of Law. Beneficiaries of a life insurance policy may not be changed by a will if the policy contract provides a specific method for changing beneficiaries.

Facts. Cook purchased a life insurance policy and named the appellant as the beneficiary. Approximately two years later, Cook and the appellant divorced. The parties agreed that the provisions of the divorce agreement would be full satisfaction of all claims by either of the parties against each other including alimony, support, and maintenance money. After the divorce, Cook stopped making payments on the life insurance policy. He was thereafter notified that his policy had changed to a paid-up term policy, and contained a provision specifying the procedure for changing a beneficiary. Cook could change the beneficiary by sending a written notice to the Equitable Life Assurance Society. Instead, Cook executed a holographic will in which he bequeathed his policy to the appellant. The will was admitted to probate and Doris Cook filed a claim with the Society for the insurance funds. The trial court ruled in favor of Doris Cook.

Issue. Whether a testator may change the beneficiary of his life insurance policy through a will even though it does not comply with the prescribed method in the insurance policy.

Held. No. A testator must comply with the rules of the insurance policy to effect a change of beneficiary. Strict compliance with insurance policy requirements is necessary to change a beneficiary under the policy. The insurer, the insured, and beneficiary should be able to rely on the certainty that policy provisions relating to the naming and changing of beneficiaries will control

Discussion. Courts will protect the expectation interest of a beneficiary under a policy. Because the testator remarried, his first wife would not have known that he had changed her as the beneficiary because he changed it in his will and not with the Society.