When a loved one becomes unable to manage their financial or personal affairs, a power of attorney (POA) can provide vital support. But not all powers granted in a POA are equal, especially when it comes to altering important financial documents like life insurance policies.
A common question received is: “Can an agent under a Florida power of attorney change the beneficiary of my life insurance policy?” The answer: Yes, but only under very specific legal conditions.
Understanding Powers of Attorney in Florida
Florida law, specifically Chapter 709 of the Florida Statutes, governs powers of attorney. A POA allows an individual (the principal) to appoint someone (the agent or attorney-in-fact) to act on their behalf. However, Florida places limits on what powers may be granted, especially for actions that could significantly affect the principal’s estate or the interests of beneficiaries.
Changing Beneficiaries Is a “Superpower” Under Florida Law
Under Section 709.2202(1) of the Florida Statutes, certain powers are considered so significant that they require express language in the POA. These powers are sometimes called “superpowers.” One of these superpowers is the authority to create or change a beneficiary designation. This means that an agent may not change the beneficiary on a life insurance policy unless the POA specifically grants that power. Additionally, if the POA was executed on or after October 1, 2011, Florida law requires the principal to initial next to the specific provision granting this authority.
Common Pitfall: General Language Is Not Enough
Simply stating that the agent may “handle all financial matters” or “manage insurance policies” is not sufficient. The POA must include clear, direct language authorizing the agent to change beneficiary designations, and when required, the appropriate initials. An example of sufficient language is: “My agent may create, amend, or revoke beneficiary designations on life insurance policies.” Without this express authority, the agent’s attempt to change a beneficiary designation may be rejected by the insurance company or result in litigation.
Insurance Company Policies May Vary
Even with a legally valid POA, life insurance companies may have internal requirements for processing beneficiary changes. These may include: a certified copy of the POA, a sworn affidavit or certification of validity, and the proper completion of the insurer’s change-of-beneficiary forms. Agents should be prepared to comply with these additional procedural steps.
Fiduciary Duties and Legal Risks
Agents who attempt to change beneficiary designations must exercise caution. As fiduciaries, they have a legal obligation to act in the principal’s best interest. If a change appears to benefit the agent or conflict with the principal’s known wishes concerning a particular asset, it may be challenged in court by other beneficiaries.
In summary, while Florida law does allow an agent under a power of attorney to change the beneficiary on a life insurance policy, the POA must contain specific, express language granting that power, and in many cases, it must be properly initialed by the principal.
Joel Ewusiak represents clients in disputes involving a power of attorney. Please contact Joel for legal assistance with your specific matter.