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Can a Minor be a Trust Beneficiary?

There are many assets that pass to children using a beneficiary designation form. A beneficiary designation is any form where beneficiaries are listed. For example, life insurance passes to the beneficiary listed on the life insurance policy. Individual retirement accounts and 401(k)’s pass to the people listed as beneficiaries on the account forms. Even certain bank accounts transfer to a listed beneficiary when the account owner dies. Each of these assets pass to the people listed as beneficiaries on the account forms and they completely bypass anything written in a person’s Trust or Will.


As with Trusts and Wills, however, beneficiary designations can be manipulated. A long-time beneficiary, such as a child, can be changed to a bad acting caregiver, neighbor, “friend,” or anyone else attempting to steal an inheritance. How do you fight against a sudden change to a beneficiary designation?

In short, you use the same legal claims that are used to overturn a bad Trust or Will. Legal concepts such as lack of capacity, undue influence, and fraud can all be used to challenge and overturn a beneficiary designation.

For example, let’s say that your mother had a life insurance policy with a $1 million death benefit. You, as her only child, have been listed as the sole beneficiary of the life insurance policy for the past twenty years. A year before your mother’s death, she is diagnosed with dementia and quickly loses her mental functioning. A week before you mother’s death, her caretaker manages to obtain your mother’s signature on a new life insurance beneficiary designation form that gives 100% of the $1 million death benefit to the caretaker. Two weeks after you mother dies, you learn for the first time that the beneficiary designation was changed.

What do you do? Most likely, you have a good legal claim to challenge the life insurance beneficiary designation that was signed a week before your mother’s death. You would file a lawsuit, notify the insurance company of the suit, and challenge the beneficiary designation based on lack of capacity and undue influence. You may also have a good case for financial elder abuse. Of course, you will have to act quickly. If the life insurance company distributes the money before you file your lawsuit, you may never see that $1 million again.

As with any lawsuit that seeks to overturn a document based on lack of capacity and undue influence, you must obtain good evidence to win your claim. To start with, you will need medical evidence to establish the mental defects of the elder. In the case discussed above, we would need medical records to establish your mother’s dementia diagnosis. Once you have your evidence, then you can proceed to trial and fight to win your rightful inheritance.