L&HIllinoismedium
Under 750 ILCS 5/503(b-5), what is the default effect on a life insurance beneficiary designation when the policyowner's marriage to the named beneficiary is dissolved in Illinois?
The former spouse's designation is no longer effective
BThe designation remains fully effective regardless of divorce
CThe proceeds automatically pass to the policyowner's children
DThe policy is voided and premiums are refunded
Why this is the answer
Section 503(b-5) of the Illinois Marriage and Dissolution of Marriage Act, 750 ILCS 5/503(b-5), provides that when a judgment of dissolution is entered after the insured named the spouse as beneficiary, the designation of the former spouse is not effective unless the judgment names the former spouse, the insured names the former spouse again after the judgment, or the former spouse takes in trust for a child or dependent. The proceeds then go to the named alternative beneficiary or, if there is none, to the insured's estate.
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