MYNORTHWEST NEWS

Who should get Josh Powell’s insurance benefits?

Mar 8, 2012, 4:40 AM | Updated: 6:52 am

Just nine days after Josh Powell murdered his two young sons and killed himself in his Pierce County home, his brother and sister tried to collect on several insurance policies he had taken out, but the insurance company isn’t sure if it should pay.

New York Life is asking a federal court in Tacoma what it should do about the insurance policies Josh Powell took out on himself and his two boys. The policies were written in 2007, and they’re worth about $1.5 million.

Josh Powell made his sister Alina and his brother Michael the beneficiaries last year. His missing wife Susan had been the original beneficiary.

Considering the murders, the suicide and the implications that Josh Powell might have had a hand in his wife’s disappearance, New York Life didn’t want to open itself to potential lawsuits by paying on the policy without asking for advice and a decision on who it should pay from a federal judge.

“The pending and potential claims are such that New York Life cannot determine without hazard to itself which of them, if any, is legally entitled to the policy proceeds without assuming the responsibility of determining doubtful questions of law and fact,” the company’s attorneys wrote in a complaint filed last Friday.

Josh Powell made several changes to his policy in the months before his death, making the beneficiaries his siblings and father rather than his missing wife. Among the company’s questions is whether those changes are valid. Susan Powell may have had a community-property interest in the policy, so it’s not clear that her husband could cancel her as the beneficiary without her consent, the lawyers wrote.

Furthermore, given his suicide, it’s not clear that Powell was legally competent to make those changes when he did so last October and December, the company’s lawyers wrote.

Alina Powell did not immediately return an email seeking comment Wednesday.

Susan Powell disappeared from the couple’s home in West Valley City, Utah, in December 2009. Josh Powell claimed he had nothing to do with it: He had taken the boys, then 2 and 4, on a midnight camping trip in the desert, during a snowstorm, when she vanished. A few weeks later, he moved with the boys to his father’s home in Puyallup, Wash. He worked from the home as a computer programmer.

His father was arrested and charged with child pornography and voyeurism last September. The state removed the boys from the home and turned them over to the care of Susan’s parents, who also live in Puyallup.

On Feb. 5, a few days after incestuous images found on his computer prompted a judge to order him to undergo a psycho-sexual evaluation, Josh Powell locked a social worker out of his rental house, attacked the boys with a hatchet and then ignited the home in an explosive, gas-fueled inferno. The social worker was not injured.

Anne Bremner, attorney for Susan Powell’s parents, Chuck and Judy Cox, said Wednesday that it was unsettling to learn that so soon after the deaths, Josh Powell’s siblings were inquiring about the life insurance proceeds. She said she’d be curious to know whether Utah authorities investigating Susan Powell’s disappearance had been aware that Josh Powell canceled her as a beneficiary on his policy, and whether that might suggest he knew she was dead, contrary to his claims that she might have run off with another man.

Both policies were originally taken out in 2007, New York Life’s lawyers wrote. Susan Powell was initially the beneficiary of Josh Powell’s policy, and he was the beneficiary of hers.

Life insurance policies typically have a two-year “contestability period.” If someone dies during the first two years of having the policy, the insurance company can contest making payments on certain grounds, for example, if the death was a suicide or if the person lied about being a smoker and then died of lung cancer. Because the two-year period had expired for Josh Powell, his suicide did not render the policy void.

The Associated Press contributed to this report.

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Who should get Josh Powell’s insurance benefits?