MH Wins Summary Judgment for Life Insurer in Beneficiary Dispute

July 19, 2023

Case Studies

McDowell Hetherington achieved a complete summary judgment win for its life insurer client. The plaintiff sued MH’s client after it paid the policy benefits to the named beneficiary following the death of plaintiff’s mother. The Plaintiff claimed she was the rightful beneficiary and that the insurer improperly allowed undue influence over plaintiff’s mother shortly before her death that resulted in the beneficiary change. Plaintiff asserted claims for unfair business practices and breach of the implied covenant of good faith and fair dealing.

MH moved for summary judgment under California Insurance Code section 10172 and was fully discharged from all liability because it paid the designated beneficiary in accordance with the policy terms, before receiving any notice from plaintiff. The San Joaquin County Superior Court agreed and granted summary judgment.

The court found it was undisputed that plaintiff’s mother, the policy owner, had reserved the right to change the beneficiary, so AGL was not required to notify or get consent from plaintiff when her mother designated the beneficiary. The court also rejected plaintiff’s arguments that alleged discrepancies in correspondence about when it received the beneficiary change form created a triable issue, finding those discrepancies immaterial. Finally, the court held that the insurer had no duty to conduct a search investigation into the beneficiary change or obtain a handwriting expert opinion before paying the named beneficiary, as plaintiff argued. Having paid the benefits to the designated beneficiary pursuant to the policy terms before receiving notice of plaintiff’s claim, MH’s client was entitled to statutory discharge from liability under section 10172.

The MH team, led by MH’s California office partner Jodi Swick, successfully extricated the client from a difficult dispute over life insurance proceeds.