For most people, an estate plan consists of numerous documents. A Last Will and Testament provides the cornerstone of any estate plan; however, other ancillary documents may also be part of the plan such as a trust, insurance policies and bank accounts. What happens if two or more of these documents conflict?
Let’s assume that Bob has a wife named Mary and two children—John and Beth. Bob dies of a heart attack. Bob’s Will specifically states that all of his assets are to be split evenly between John and Beth and that Mary is not to receive any of his assets. Shortly after Bob’s death though, a life insurance policy is located that names Mary as the beneficiary. In addition, a bank account names Mary as the “payable on death” designee. Does Mary get the life insurance proceeds and the funds held in the bank account or does the Will prevent her from benefiting from those assets?
Only an estate planning attorney can answer specific questions about conflicting documents; however, as a general rule, a Last Will and Testament only governs assets that are individually owned by the maker of the Will and that are not already disposed of elsewhere. In the case of an insurance policy or a bank account that specifically names a beneficiary, those beneficiary designations will usually determine what happens to the assets despite the broad statements in the Will to the contrary.
Because of the possibility of conflict among documents in your estate plan, be sure to consult with your estate planning attorney about all your estate planning documents.
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- Beneficiary Designations and Other Non-Probate Transfers - August 15, 2020
- Leaving Assets Can Be Tricky – Part 3 - August 13, 2020
