In the event of a divorce, a person may be required to be a named beneficiary of a life insurance policy pursuant to a divorce decree. Courts will often impose this requirement to protect the welfare of surviving children who remain under the care of the former spouse. When a divorce decree requiring the insured to maintain a former spouse as beneficiary of a life insurance policy has been violated, such as when the insured changes beneficiaries, the former’s spouse’s standing to maintain an action to recover the benefits is based on the former spouse’s vested equitable interest in the proceeds.
Similarly, a child ordered to be maintained as beneficiary of a life insurance policy under a divorce decree acquires an equitable interest in the insurance benefits. If the life insurance obligation has been violated, the child may be entitled to enforce the insurance provision by maintaining an action to recover the benefits of an insurance policy under which another person is named beneficiary.