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Monday, June 14, 2010

What happens when two people die at the same time?

Husbands and wives often want to know what will happen with their estates if they should both be killed in the same accident. In particular, the questions are about situations in which there is no way of knowing which one of them died before the other.

The law (in Alberta, the Survivorship Act) says that of the two people who died, the one who is younger is deemed to have survived the longest.

This means that the Will of the younger person is the one that will be followed. Most (but not all) husbands and wives have Wills that are "mirrors" of each other, meaning that their Wills make the same provisions. If they have no Wills, their estates will be distributed according to intestacy law based on the younger person. In a future post I'll go into more detail about who is in line under the law, but for now it's enough to say that intestacy laws would operate so that in the absence of children, the entire estate would go to the family (siblings, parents, etc) of the younger person with nothing going to the family of the older person.

Joint property of all kinds will be put into the name of the younger person for his or her executor or administrator to deal with.

Many husbands have life insurance policies that are supposed to pay a sum of money to the wife on the death of the husband, and vice versa. There is actually a law in place to deal with the scenario of the insured person and the beneficiary of a life insurance policy dying at the same time. When a life insured person (say, the husband) and the beneficiary of the policy (say, the wife) are both killed simultaneously, the policy is paid as if the beneficiary had died first.

This means that if the wife is the only beneficiary of the policy, the life insurance money will be paid to the husband's estate. From there it can be paid out according to his Will.

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