Are Beneficiary Designations Protected in New York?
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.NY EPTL § 5-1.4; § 5-1.1-A (elective share); § 4-1.6; §§ 13-4.1 to 13-4.12 (Uniform TOD Security Registration Act); § 7-5.1 et seq. (Totten trust/POD accounts); § 7-6.1 et seq. (UTMA); CPLR § 5205(c); Riggs v. Palmer, 115 N.Y. 506 (1889); DRL § 236-BVerified May 31, 2026 These designations override the terms of a will or trust. Outdated designations remain in effect regardless of other estate planning documents.
Yes. New York automatically revokes an ex-spouse as beneficiary upon divorce for the following asset types: life insurance, retirement accounts, pod accounts, tod accounts, annuities.NY EPTL § 5-1.4; § 5-1.1-A (elective share); § 4-1.6; §§ 13-4.1 to 13-4.12 (Uniform TOD Security Registration Act); § 7-5.1 et seq. (Totten trust/POD accounts); § 7-6.1 et seq. (UTMA); CPLR § 5205(c); Riggs v. Palmer, 115 N.Y. 506 (1889); DRL § 236-BVerified May 31, 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.
New York does not provide specific creditor protection for inherited IRAs.NY EPTL § 5-1.4; § 5-1.1-A (elective share); § 4-1.6; §§ 13-4.1 to 13-4.12 (Uniform TOD Security Registration Act); § 7-5.1 et seq. (Totten trust/POD accounts); § 7-6.1 et seq. (UTMA); CPLR § 5205(c); Riggs v. Palmer, 115 N.Y. 506 (1889); DRL § 236-BVerified May 31, 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 New York 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 New York'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 New York inheritance calculator.
No. New York does not default to per stirpes for beneficiary designations.NY EPTL § 5-1.4; § 5-1.1-A (elective share); § 4-1.6; §§ 13-4.1 to 13-4.12 (Uniform TOD Security Registration Act); § 7-5.1 et seq. (Totten trust/POD accounts); § 7-6.1 et seq. (UTMA); CPLR § 5205(c); Riggs v. Palmer, 115 N.Y. 506 (1889); DRL § 236-BVerified May 31, 2026 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.
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