How do beneficiary designations work in Maryland?

Beneficiary designations on life insurance, retirement accounts, POD bank accounts, and TOD brokerage accounts determine who receives those assets at death (Md. Code, Est. & Trusts § 4-105; § 14.5-604; § 16-107; Md. Code, Fin. Inst. § 1-204). These designations override the terms of a will or trust. Outdated designations remain in effect regardless of other estate planning documents.

Are inherited IRAs protected from creditors in Maryland?

Maryland provides partial creditor protection for inherited IRAs (Md. Code, Cts. & Jud. Proc. § 11-504(h)(1)). The level of protection may depend on whether the IRA was inherited from a spouse or non-spouse, and whether the case is in state or federal court.

Are Beneficiary Designations Protected in Maryland?

Check how divorce, creditors, and state laws affect your life insurance, retirement accounts, and other beneficiary designations.

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This tool provides general information about state beneficiary designation laws. It does not constitute legal advice. ERISA-governed plans are subject to federal law which may differ from state law. Consult a licensed attorney for advice specific to your situation.Data verified 2026-07-13

Frequently Asked Questions

Beneficiary designations on life insurance, retirement accounts, POD bank accounts, and TOD brokerage accounts determine who receives those assets at death. These designations override the terms of a will or trust. Outdated designations remain in effect regardless of other estate planning documents.

No. Maryland does not automatically revoke an ex-spouse as beneficiary upon divorce. All beneficiary designations on life insurance, retirement accounts, and other assets must be updated manually after a divorce, or the ex-spouse may still receive those assets.

Maryland provides partial creditor protection for inherited IRAs. The level of protection may depend on whether the IRA was inherited from a spouse or non-spouse, and whether the case is in state or federal court.

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 Maryland 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 Maryland'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 Maryland inheritance calculator.

No. Maryland does not default to per stirpes for beneficiary designations. If a named beneficiary dies before the account holder, the share typically lapses unless the designation explicitly includes per stirpes language or names contingent beneficiaries.

Beneficiary Rules in Maryland

Maryland does not automatically revoke an ex-spouse as beneficiary after divorce (No). All designations on life insurance, retirement accounts, and bank accounts must be updated manually. Failing to do so can result in an ex-spouse receiving assets that were intended for someone else.

Spousal consent for beneficiary designations in Maryland is limited to ERISA-governed qualified plans under federal law. State-level consent requirements do not apply in non-community property states. Use the Maryland inheritance calculator to see how assets without valid designations are distributed.

Inherited IRA creditor protection in Maryland is Partial creditor protection. Since the Supreme Court ruled in Clark v. Rameker (2014) that inherited IRAs are not protected under federal bankruptcy law, state statutes are the primary source of protection.

Maryland's per stirpes default is No. Without contingent beneficiaries, a lapsed designation routes assets through probate. Estimate coverage needs with the Maryland life insurance calculator.

SimplyTrust Editorial·Updated July 13, 2026

Legal Sources

Data sourced from Maryland statutes and official state code. How we research.

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