Are life insurance benefits considered "income" by the California Courts?

Although the statutory definition is very broad (In re Marriage of Rocha (1998) 68 Cal.App.4th 514, 516; Stewart v. Gomez (1996) 47 Cal.App.4th 1748, 1753, 1755), it is not unlimited. It does not extend to every type of payment or economic benefit received by a parent. For instance, in addition to the statutory exceptions ( 4058, subd. (c)), we have previously held that the proceeds of student loans are not income (In re Marriage of Rocha, supra, 68 Cal.App.4th at pp. 516-518). Similarly, we conclude that life insurance benefits are not within the statutory definition of income, for the following reasons.

First, it is established that gifts, whether inter vivos (In re Marriage of Schulze (1997) 60 Cal.App.4th 519, 529) or testamentary (County of Kern v. Castle (1999) 75 Cal.App.4th 1442, 1448-1454), are not within the scope of the statutory definition of income. It is impossible to draw a rational distinction between a gift made by designating the donee as the beneficiary of a will and a gift made by designating the donee as the beneficiary of a life insurance policy.