Do life insurance beneficiary rights get governed by the transfer of property by will or intestacy?

• A. No; designation controls under contract terms
• B. Yes; designation passes as part of the estate
• C. Only if named in the will
• D. Only if no beneficiary designation exists

Answer: (A)

Life insurance proceeds follow the beneficiary designation, which is a contractual instruction between the insured and the insurer. This creates a non-probate transfer, so the payout goes to the named beneficiary outside the probate process and is not determined by the will or by intestacy laws. The will cannot override a valid beneficiary designation, and probate rules generally don’t apply to the proceeds when a designation exists. The only time the estate would receive the money is if there is no valid beneficiary designation (or all named beneficiaries are invalid or predeceased with no contingent beneficiary), and then the funds would pass like any other estate asset. So the designation controls under the contract terms.