What are the beneficiary designation rules in Texas?

Beneficiary designations on life insurance, retirement accounts, POD bank accounts, and TOD brokerage accounts determine who receives those assets at death (Tex. Fam. Code §§ 9.301, 9.302; Tex. Fam. Code §§ 3.102, 3.104; Tex. Est. Code §§ 111.052, 113.152, 114.057, 115.005, 123.052, 123.151, 201.058, 255.153; Tex. Ins. Code §§ 1103.151-1103.152; Tex. Prop. Code § 42.0021). These designations override the terms of a will or trust. Outdated designations remain in effect regardless of other estate planning documents.

Does divorce revoke beneficiary designations in Texas?

Yes. Texas automatically revokes an ex-spouse as beneficiary upon divorce for the following asset types: life insurance, retirement accounts, pod accounts, tod accounts, annuities (Tex. Fam. Code § 9.301; Tex. Fam. Code § 9.302; Tex. Est. Code § 123.052; Tex. Est. Code § 123.151; Tex. Est. Code § 114.057). 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.

Are Beneficiary Designations Protected in Texas?

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 Outdated designations remain in effect regardless of other estate planning documents.

Yes. Texas automatically revokes an ex-spouse as beneficiary upon divorce for the following asset types: life insurance, retirement accounts, pod accounts, tod accounts, annuities. 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.

Texas is a community property state, but it does not require a spouse's consent to name a non-spouse beneficiary. Each spouse manages their own community property, and the other spouse's claim to their half of community-funded assets is raised after death rather than through a consent form. Federal ERISA rules separately require spousal consent for qualified retirement plans such as 401(k)s.

Yes. Texas provides full statutory protection for inherited IRAs from creditors. After the Supreme Court's Clark v. Rameker (2014) decision ruled inherited IRAs are not protected under federal bankruptcy law, state-level protections became the primary shield.

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 Texas 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 Texas'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 Texas inheritance calculator.

No. Texas 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 Texas

Divorce in Texas triggers automatic revocation of ex-spouse beneficiary designations (Yes). Federal ERISA plans are exempt from this rule, so 401(k)s and employer pensions require a manual change. The life insurance calculator recalculates coverage needs after a divorce.

As a community property state, Texas requires spousal consent to name a non-spouse beneficiary on community property retirement accounts (No). This protection applies in addition to federal ERISA consent requirements for qualified plans. See how Texas divides marital assets with the inheritance calculator.

Texas provides Full creditor protection creditor protection for inherited IRAs. State law varies widely on this issue since the Supreme Court's 2014 Clark v. Rameker decision.

The per stirpes default in Texas is No. Per stirpes means that if a named beneficiary dies before the account holder, the share passes to that beneficiary's descendants. Without per stirpes language or contingent beneficiaries, a lapsed designation routes assets to the estate. The Texas life insurance calculator estimates coverage based on current family needs.

SimplyTrust Editorial·Updated July 13, 2026

Legal Sources

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

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