Effect of Divorce on Beneficiary Designations
Many divorced individuals die without changing the beneficiary designations of life insurance and IRAs from their former spouse to a new beneficiary. Unfortunately, prior to July 1, 2012, such a designation would be valid. Thus, your former spouse would have been entitled to collect the proceeds payable from your life insurance and IRAs.
A new statute, Fla. Stat § 732.703, was created and now governs the effect of divorce, dissolution or invalidity of marriage on the disposition of certain assets with beneficiary designations, like life insurance and IRAs. A beneficiary designation made by the decedent is void if at the time of death: (1) the marriage is dissolved or declared invalid by a court order and (2) the designation was made prior to such dissolution or court order. The asset will then pass as if the former spouse predeceased decedent.
IMPORTANT: If you were divorced prior to July 1, 2012 and you still want your former spouse to be a beneficiary, then be sure to update your beneficiary designations. Also, always make sure your life insurance and IRAs have a secondary beneficiary designation.