Detailed Answer
In North Carolina, a divorce automatically revokes an ex-spouse’s beneficiary designation on certain non-probate instruments under N.C.G.S. § 31-5. This statute covers wills, trusts, life insurance policies, payable-on-death accounts, and other contracts. By operation of law, a former spouse loses any right to receive property or benefits that would otherwise pass directly through those instruments.
However, if your pension plan is governed by the federal Employee Retirement Income Security Act (ERISA), the rules change. ERISA contains a broad preemption provision—29 U.S.C. § 1144(a)—that generally displaces state laws “relating to” employee benefit plans. As a result, an ERISA-covered pension plan follows its own terms and procedures, not state revocation statutes. In practical terms, a divorce will not automatically remove your ex-spouse as the beneficiary under an ERISA plan.
Under ERISA, the plan document and beneficiary designation form control who receives death benefits. If you want to replace your ex-spouse, you must complete a new beneficiary designation in accordance with your plan’s rules. Failing to update that form leaves the ex-spouse entitled to benefits, even after divorce.
To avoid unintended distributions, review your plan documents and beneficiary forms as soon as your divorce is final. Submit a new designation to your plan administrator if you wish to name someone else. If you have questions about your rights under ERISA or state law, consult an attorney familiar with North Carolina probate and federal benefit rules.
Key Takeaways
- ERISA preempts state laws that “relate to” employee benefit plans. 29 U.S.C. § 1144(a).
- North Carolina’s revocation-on-divorce statute (N.C.G.S. § 31-5) does not override ERISA-governed plans.
- The plan document and beneficiary designation form determine who receives benefits.
- Divorce alone does not remove an ex-spouse from an ERISA pension. You must update your designation.
- Keep copies of your updated beneficiary forms and follow up with your plan administrator.
Protect Your Legacy Today
Divorce can upend your estate plan and retirement benefits. At Pierce Law Group, we guide you through federal and state rules to secure your intentions. Our attorneys have deep experience in North Carolina probate administration and ERISA matters. To discuss your pension plan, beneficiary designations, or any related issue, email us at intake@piercelaw.com or call (919) 341-7055.
