Are Beneficiary Designations Protected in Indiana?
Check how divorce, creditors, and state laws affect your life insurance, retirement accounts, and other beneficiary designations.
Frequently Asked Questions
Beneficiary designations on life insurance, retirement accounts, POD bank accounts, and TOD brokerage accounts determine who receives those assets at death.IC 29-1-5-8; IC 32-17-14-22; IC 32-17-14-23; IC 32-17-14-2(c); IC 32-17-14-2.5; IC 34-55-10-2; IC 29-1-2-12.1; IC 29-1-3Verified Jul 13, 2026 These designations override the terms of a will or trust. Outdated designations remain in effect regardless of other estate planning documents.
Yes. Indiana automatically revokes an ex-spouse as beneficiary upon divorce for the following asset types: tod accounts, pod accounts.IC 29-1-5-8; IC 32-17-14-22; IC 32-17-14-23; IC 32-17-14-2(c); IC 32-17-14-2.5; IC 34-55-10-2; IC 29-1-2-12.1; IC 29-1-3Verified Jul 13, 2026 However, ERISA-governed employer plans such as 401(k)s and pensions are subject to federal law and must be updated manually regardless of state rules.
Indiana does not provide specific creditor protection for inherited IRAs.IC 29-1-5-8; IC 32-17-14-22; IC 32-17-14-23; IC 32-17-14-2(c); IC 32-17-14-2.5; IC 34-55-10-2; IC 29-1-2-12.1; IC 29-1-3Verified Jul 13, 2026 Following the Supreme Court's Clark v. Rameker (2014) decision, inherited IRAs are generally not protected in bankruptcy proceedings in states without their own protective statutes.
Yes. The federal Employee Retirement Income Security Act (ERISA) preempts state law for employer-sponsored plans such as 401(k)s, pensions, and group life insurance. Even if Indiana automatically revokes an ex-spouse upon divorce, ERISA-governed plans follow the designation on file with the plan administrator. The Supreme Court confirmed this in Egelhoff v. Egelhoff (2001) and Kennedy v. Plan Administrator (2009).
When no valid beneficiary designation exists, the asset typically passes to the account holder's estate and is distributed through probate under Indiana's intestacy laws. This can result in delays, additional costs, and the assets going to someone other than the intended recipient. See who inherits with the Indiana inheritance calculator.
Yes. Indiana applies a per stirpes default for beneficiary designations.IC 29-1-5-8; IC 32-17-14-22; IC 32-17-14-23; IC 32-17-14-2(c); IC 32-17-14-2.5; IC 34-55-10-2; IC 29-1-2-12.1; IC 29-1-3Verified Jul 13, 2026 If a named beneficiary dies before the account holder, the deceased beneficiary's share passes to their descendants rather than to the remaining named beneficiaries.
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