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June 23, 2024


Life insurance litigation can be controlled by both state court and federal principles. In Florida a Trial Court Order in some circumstances has no effect on federal entitlement to life insurance benefits.

This rule was most clearly set forth in the US Supreme Court case of Ridgeway v. Ridgeway (102 S. Ct. 49) US 1981.

Richard H. Ridgway, a career sergeant in the United States Army, was initially married to April Ridgway, with whom he had three children. Upon their divorce, a Maine court decree required Richard to maintain life insurance policies for the benefit of his children. At that time, he had a $20,000 policy issued under the SGLIA, with April named as the beneficiary.

Richard remarried Donna Ridgway and subsequently changed the policy’s beneficiary designation to “by law,” meaning the proceeds would go to his current lawful spouse at the time of his death, per the SGLIA’s provisions. Upon Richard’s death, both April and Donna filed claims for the policy proceeds. April sought to enforce the state court’s divorce decree, which directed that the insurance benefits should go to their children.

The Maine Superior Court initially sided with Donna, recognizing that the imposition of a constructive trust for the children would conflict with the SGLIA and the Supremacy Clause. However, the Maine Supreme Judicial Court vacated this decision, directing that the proceeds be held in trust for the children.

The U.S. Supreme Court ultimately reversed the Maine Supreme Judicial Court’s decision, asserting that federal law, specifically the SGLIA, preempted the state court order.

The Supremacy Clause of the U.S. Constitution (Article VI, Clause 2) establishes that federal law takes precedence over state laws when there is a conflict. In this case, the SGLIA granted the insured servicemember the right to freely designate and alter the beneficiary of his life insurance policy.

Under the SGLIA, the insured servicemember has the unambiguous right to designate any beneficiary and change that designation at any time without the consent of the previous beneficiary. This federal statute also includes an anti-attachment provision, protecting policy proceeds from claims of creditors and any form of legal or equitable seizure.

The Supreme Court, led by Justice Blackmun, held that the SGLIA’s provisions override any conflicting state laws or court orders. The Court emphasized that the clear federal interest in allowing servicemembers to control their life insurance beneficiary designations must prevail over state-imposed obligations or trusts. The decision was rooted in the understanding that the federal statute’s language and legislative intent must be honored to ensure uniformity and predictability in the administration of servicemembers’ benefits.

Implications for Life Insurance Litigation

The Court ruling in Ridgeway is critical to understand as Life Insurance Policy disputes can be altered by state court rulings (most commonly in divorce settlements). The federal preemption or supremacy clause means that state Court Trial Orders regarding insurance policies can be rendered ineffectual if the federal policy is not changed by the named insured.

Our office litigates Life Insurance disputes throughout the state of Florida. If you have questions about anything contained in this article or anything else just give us a call. We offer free consultations and we would love to hear from you.

-Brice Zoecklein, Esq.


Disclaimer:   The information contained in this blog/website is for informational purposes only and provides general information about the law but not specific advice.  This information should not be used as a substitute for advice from competent legal counsel as laws change and the facts in your specific case need to be analyzed.