Is a spouse entitled to a portion of the proceeds of her husband's life insurance when the husband dies?

The issue did arise, albeit obliquely, in Biltoft v. Wootten (1979) 96 Cal.App.3d 58, 157 Cal.Rptr. 581. There, premiums for husband's term insurance were deducted from his salary. The parties separated, and husband changed the beneficiary designation from his wife to his children. He died while the dissolution action was pending. One child claimed wife had no community interest in the proceeds of the policy because (1) "term insurance only provides insurance for each premium period and that therefore each premium payment is a new contract and purchases a new policy of insurance" (id., at p. 60, 157 Cal.Rptr. 581) and (2) "no person has an interest in a term life insurance policy beyond the date a premium is due, and ... if decedent had permitted the policy to lapse, [wife] would have no claim because no property right arises until the insured dies." (Id., at p. 61, 157 Cal.Rptr. 581.) The court disagreed, noting, "if the decedent had waited until separation to purchase the ... policy, it is unlikely that he would have been able to obtain coverage for the same premium on the same terms of eligibility. The rights of the beneficiaries with respect to this policy were dependent on the fact that the decedent secured the policy during the marriage. The decedent's community efforts for the 20 years prior to the separation maintained the policy in force." (Ibid.) Accordingly, wife was given a proportionate share of the proceeds based on the percentage of premiums paid from community earnings.

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