life insurance

Hillman v. Maretta

Warren Hillman named his wife, Judy Maretta, the beneficiary of his Federal Employees’ Group Life Insurance Act (FEGLIA) in 1996. The two subsequently divorced and Hillman remarried, but never changed the named beneficiary on his plan to his new wife, Jacqueline Hillman. Upon Warren Hillman’s death, Jacqueline Hillman attempted to claim death benefits under this policy, but her claim was denied because she was not the named beneficiary. Maretta received the benefits instead and Jacqueline Hillman commenced a suit against Maretta for the full amount of the death benefits.

Under Virginia state law, when a couple is divorced their beneficiary designations are automatically revoked. However, the  FEGLIA states that the beneficiary named on the policy shall receive the death benefits regardless of current marital status. The Supreme Court will now decide whether FEGLIA preempts Virginia’s state law regarding named beneficiaries, which will determine whether Jacqueline Hillman or Judy Maretta receives Warren Hillman’s death benefits. This case involves the proper balance of the federal government’s interest in uniform rules for the distribution of FEGLI benefits and the state of Virginia’s interest in seeing the intended beneficiary, rather than the named beneficiary, receive the death benefits.


Questions as Framed for the Court by the Parties: 

VA. CODE ANN. § 20-111.1(A) (2011) provides that a life insurance policy's revocable beneficiary designation naming a then spouse is deemed revoked upon the entry of a Final Decree of Divorce. 5 U.S.C. § 8705(a) provides that the proceeds from a Federal Employees Group Life Insurance (FEGLI) policy should be paid to the beneficiaries properly designated by the employee, and if none, then to the widow of the employee. If VA. CODE ANN. § 20-111.1 (A) is preempted by 5 U.S.C. § 8705(a) or any other federal law, VA. CODE ANN. § 20-111.1(D) (2011), gives the widow (or whoever would otherwise be entitled to the insurance proceeds), after FEGLI insurance proceeds have been distributed to an ex-spouse, a domestic relations equitable remedy against the ex-spouse for the amount of the insurance proceeds received.

The Supreme Court of Virginia, in agreement with the Supreme Court of Alabama, the First, Seventh and Eleventh Circuits of the United States Court of Appeals and several lower federal courts, but in direct conflict with the Indiana Supreme Court, the Supreme Court of Mississippi, the Court of Appeals of North Carolina, the Appellate Court of Illinois, the Missouri Court of Appeals, the Court of Appeals of Texas, the Superior Court of New Jersey, Appellate Division, the Superior Court of Pennsylvania, and the Court of Appeals of Kentucky, held that 5 U.S.C. § 8705(a) preempts a state domestic relations equitable action against the beneficiary of a FEGLI policy after the insurance proceeds of such policy have been paid to such beneficiary in accordance with the statutory order of precedence in 5 U.S.C. § 8705(a).

The question presented is whether 5 U.S.C. § 8705(a), any other provision of the Federal Employees Group Life Insurance Act of 1954 (FEGLIA) or any regulation promulgated thereunder preempts a state domestic relations equitable remedy which creates a cause of action against the recipient of FEGLI insurance proceeds after they have been distributed, like the one contained in VA. CODE ANN. § 20-111.1(D).


Whether any provision of the Federal Employees Group Life Insurance Act of 1954 preempts states from creating an equitable remedy where a third party can recover the amount of the Federal Employees Group Life Insurance benefit from the original beneficiary.

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whole life insurance


Life insurance coverage that runs for the insured’s natural life. Whole life insurance provides both term life insurance and a savings plan (i.e., accumulation of “cash value” or “surrender value”) that allows for the insured, at any time after an initial period but before the insured’s death, to surrender the policy for that value or sometimes to borrow against it without surrendering the policy. Also termed ordinary life insurance; straight life insurance; permanent insurance.



universal life insurance


A form of life insurance that offers flexible premiums, adjustable death benefits, and the ability of the insured to make partial withdrawals from the cash value. Universal life insurance policies generate cash value as the insured’s premium payments are invested into the insurer’s investment fund. The insurer pays the interest at a rate that is competitive with other investments, such as treasury bills, and the insured may use that interest to pay for his or her life insurance premiums.


term life insurance


A life insurance policy whereby the insured purchases coverage lasting for a specific period of time. The designated beneficiary collects the proceeds only if the insured dies within the specified term. There is no investment component to the policy, so the insured cannot surrender the policy for cash value during his or her lifetime. Usually, as the insured ages and the risk of death increases, either the premium amount increases or the amount of insurance coverage decreases. Also termed term policy.



actuarial tables



Statistical tables that display the life expectancies of people based on certain characteristics such as age, gender, family history, and health. Actuarial tables are usually admissible in court as evidence of life expectancy.  Also termed expectancy table; mortality table; mortuary table; life table.



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