“Murder is always a mistake. One should never do anything that one cannot talk about after dinner.” —Oscar Wilde
We’ll end the week on the uplifting note that “murder does not pay.”
What happens when the sole beneficiary of an ERISA plan life benefit kills the plan participant (insured)?
Are state slayer statutes (which prohibit murder for profit) preempted by ERISA? No.
Here’s the case of Union Security Life Insurance Co. v. JJG-1994; JJG-2002, [PDF], a minor, __F.Supp.2d__, 2011 WL3737277 (N.D.NY August 24, 2011)(attached)(State slayer rules NOT preempted by ERISA).
FACTS: An employee was covered under the employer’s group life insurance benefits. He was murdered by the sole beneficiary of the employee’s group life benefits. No contingent beneficiary was identified in plan documents.
ISSUE: Whether one who kills the ERISA plan participant may continue as the sole beneficiary of the life insurance benefits?
HELD: No. State law prohibiting a killer from profiting from his crime is NOT preempted by ERISA.
RATIONALE: Some state laws of “general application” may have only an incidental effect on ERISA and are therefore not preempted.