Short Answer

In North Carolina, an agent under a power of attorney may change beneficiary designations on life insurance or retirement accounts only if the power of attorney document expressly grants that authority. Even with express authority, the agent must act in the principal’s best interests and follow plan or policy rules. If an agent changes beneficiaries without proper authority or in bad faith, a court can undo the change or impose remedies after the principal’s death.

Understanding the Problem

In North Carolina probate, can an older sibling who held a parent’s power of attorney change beneficiaries on the parent’s insurance and retirement accounts before death? This matters because a minor child’s share depends on whether those assets pass outside probate by beneficiary designation or can be recovered for the estate.

Apply the Law

North Carolina’s power of attorney laws require a specific, written grant before an agent can perform certain “hot powers,” including changing beneficiary designations. Insurance and retirement benefits with named beneficiaries usually pass outside probate at death, but courts can intervene if an agent exceeded authority or breached fiduciary duties. Challenges typically begin with an accounting request before the Clerk of Superior Court and, when monetary relief is needed, proceed in Superior Court.

Key Requirements

• Express authority: The POA document must clearly authorize changing beneficiary designations; silence means no authority.
• Fiduciary duty and best interest: The agent must act in good faith, avoid self-dealing, and follow the principal’s known objectives.
• Plan/policy compliance: Any change must follow insurer or plan administrator procedures (forms, consents) to be effective.
• Post-death remedies: After death, the estate or interested persons can seek an accounting, damages, or a constructive trust over wrongly diverted proceeds.
• Forum and standing: Accounting and authority questions go to the Clerk of Superior Court; claims for money or constructive trust are filed in Superior Court by the personal representative (and, for minors, through a guardian ad litem if needed).
• Year’s allowance for minors: A minor child may claim a priority allowance from the decedent’s personal property within one year of death.

What the Statutes Say

• North Carolina Gen. Stat. § 32C-2-201 (Authority requiring specific grant) – Changing beneficiary designations requires express authority in the POA.
• North Carolina Gen. Stat. § 32C-1-117 (Agent’s liability; remedies) – Courts may order accountings, restoration of property, constructive trusts, and other relief for POA breaches.
• North Carolina Gen. Stat. § 32C-1-116 (Judicial relief) – Procedure to seek court orders about an agent’s authority and accountings.
• North Carolina Gen. Stat. § 30-17 (Child’s year’s allowance) – Minor children’s allowance amount and one-year filing window.

Analysis

Apply the Rule to the Facts: If the older sibling’s POA did not clearly authorize changing beneficiary designations, any pre‑death beneficiary change was beyond the agent’s power. Even if the POA included that power, the agent still had to act in the parent’s best interests and follow insurer/plan procedures. Because the child is a minor, the estate (through a personal representative) can seek an accounting and, if needed, ask the Superior Court to impose a constructive trust on wrongly diverted insurance or retirement proceeds.

Process & Timing

1. Who files: A parent/guardian for the minor or another interested person. Where: Clerk of Superior Court in the county of the decedent’s domicile. What: Apply to open an intestate estate using AOC‑E‑202 (Application for Letters of Administration). For the child’s allowance, file AOC‑E‑100 (Application and Assignment of Year’s Allowance). To investigate the agent, file a verified petition under § 32C‑1‑116 to compel an accounting. When: File the child’s allowance within one year of death; accounting petition as soon as letters issue (or by another interested person if appropriate).
2. After letters are issued, the Clerk can order the agent to produce records and substantiate transactions. Expect several weeks to a few months for document production; timelines vary by county and case complexity.
3. If records show unauthorized changes or transfers, the personal representative files a civil action in Superior Court for breach of fiduciary duty and related remedies (e.g., constructive trust over insurance or retirement proceeds paid to the wrongful beneficiary). The court may grant interim relief, such as restraining orders, to preserve assets.

Exceptions & Pitfalls

• If the POA expressly authorized beneficiary changes and evidence shows the principal intended the change, courts are less likely to undo it.
• Workplace retirement plans and group life policies often must follow the beneficiary on file with the plan administrator; challenges typically target the recipient after payout (e.g., constructive trust), not the plan.
• Nonprobate assets (insurance/retirement) usually bypass the estate; do not rely on probate to retitle them. Seek court remedies if an agent misused POA powers.
• Do not skip opening the estate; letters of administration establish standing to demand an accounting and pursue court relief.
• For minors, expect a guardian ad litem and, in some allowance proceedings, judge approval to protect the child’s interests.

Talk to a Probate Attorney

If you’re dealing with disputed beneficiary changes or potential POA misuse, our firm has experienced attorneys who can help you understand your options and timelines. Call us today at [919-341-7055].

Disclaimer: This article provides general information about North Carolina law based on the single question stated above. It is not legal advice for your specific situation and does not create an attorney-client relationship. Laws, procedures, and local practice can change and may vary by county. If you have a deadline, act promptly and speak with a licensed North Carolina attorney.