During a Montana divorce you may not change the beneficiary on a life insurance policy, a retirement account, or any other asset without your spouse's written consent or a court order. After the decree, a Montana statute automatically revokes many beneficiary designations that name a former spouse, but it has exceptions large enough that you should not count on it. This page explains both rules. It is part of our Montana Divorce Guide.
Three Stages, Three Rules
| Stage | Rule | MCA |
|---|---|---|
| While the case is pending | Both spouses are restrained from changing the beneficiary on any life insurance policy or other account or asset, from borrowing against cash value, and from letting a policy lapse. | § 40-4-126 |
| When the decree is entered | The restraining order dissolves. A divorce revokes revocable dispositions to a former spouse in governing instruments signed before the divorce, unless an exception applies. | § 40-4-126; § 72-2-814(2) |
| After the decree | Each person is free to update designations, subject to anything the decree or agreement requires, such as keeping insurance in place. | The decree |
During the Case: The Restraining Order
When a petition for dissolution, legal separation, or declaration of invalidity is filed, the clerk issues an automatic economic restraining order with the summons (MCA § 40-4-126). It binds the petitioner on filing and the respondent on service. Several of its terms concern insurance and beneficiaries. The parties are restrained from:
- "changing or in any manner altering the beneficiary designation on any life insurance policies on either party or their children or changing or in any manner altering the beneficiary on any other account or asset";
- withdrawing or borrowing any part of the cash surrender value of a life insurance policy on either party or the children, except as the order allows;
- "canceling, altering, or allowing to lapse any existing property, life, automobile, or health insurance policies."
The order also requires a spouse to file a notice with the court at least 14 days before a proposed revocation of a nonprobate transfer or elimination of a right of survivorship. A nonprobate transfer is an instrument other than a will that transfers property on death, such as a revocable trust, a pay-on-death account, or a transfer on death deed. If the other spouse objects within 14 days, the action waits for the court's ruling.
The point of these terms is to keep things as they are until the court or the spouses decide what happens. A violation can be brought to the court, which may issue enforcement orders including sanctions and contempt remedies. See our guide to the automatic economic restraining order.
What You May Still Do Before the Decree
The order is specific about what is not restrained. Unless the court orders otherwise, a party may create, modify, or revoke a will, revoke or change a power of attorney, and create an unfunded revocable or irrevocable trust. Spouses can also waive parts of the order by joint written agreement, and either may ask the court to modify it.
If you want to change who would inherit from you or who would make decisions for you while the case is pending, talk to an estate planning lawyer. A&M Law does not practice estate planning or probate.
After the Decree: Montana's Revocation-on-Divorce Statute
The restraining order dissolves when the decree is entered. At that point MCA § 72-2-814 takes effect. Under subsection (2), a divorce or annulment:
- revokes any revocable disposition or appointment of property made by a divorced individual to the former spouse in a governing instrument, and any made to a relative of the former spouse;
- revokes a revocable nomination of the former spouse or the former spouse's relative as personal representative, trustee, conservator, agent, or guardian; and
- severs property the former spouses held as joint tenants with the right of survivorship, turning it into a tenancy in common.
A "governing instrument" here means one the divorced individual executed before the divorce, and the definition of a disposition includes a benefit to a beneficiary designated in such an instrument. Revoked provisions are given effect as if the former spouse had disclaimed them (§ 72-2-814(4)). They are revived if the former spouses remarry each other (§ 72-2-814(5)).
A legal separation is not enough. The statute says a decree of separation that does not terminate the marital status "is not a divorce for purposes of this section."
The Limits: Public Pensions, Decrees, and ERISA
The opening words of § 72-2-814(2) carve out three situations. The revocation applies "except as to a retirement system established in Title 19," which covers Montana's public employee retirement systems, and except "as provided by the express terms of a governing instrument, a court order, or a contract relating to the division of the marital estate." So a decree that requires a former spouse to stay as beneficiary controls over the automatic rule. See Montana public pensions in divorce.
Federal law adds another limit. In Egelhoff v. Egelhoff, 532 U.S. 141 (2001), the U.S. Supreme Court considered a Washington statute that automatically revoked a spouse's beneficiary designation on divorce and held that ERISA preempts it to the extent it applies to ERISA plans. The Court reasoned that ERISA requires plans to be administered, and benefits paid, in accordance with plan documents. Whether a particular employer life insurance or retirement plan is governed by ERISA is a question for the plan administrator.
Montana's statute anticipates preemption. If federal law preempts it as to a payment, a former spouse who received the payment for no value is personally liable for that amount to the person who would have been entitled to it (§ 72-2-814(8)(b)). Enforcing that would mean a lawsuit between the family and the former spouse, which is the kind of dispute a simple beneficiary change avoids.
Payors are also protected. An insurer or other payor that pays the named beneficiary before receiving written notice of the divorce in the manner the statute requires is not liable for doing so (§ 72-2-814(7)).
Life Insurance as Security for Support
Under MCA § 40-4-208(4), the obligation to pay future maintenance ends on the death of either party unless a written agreement or the decree says otherwise. Child support does not end when the paying parent dies (§ 40-4-208(7)), but collecting it from an estate is not simple. For both reasons, a settlement agreement can address life insurance: who must carry it, in what amount, who is named, and for how long. A decree term like that overrides the automatic revocation, because § 72-2-814(2) yields to a court order.
If you are negotiating maintenance, see our maintenance overview and how long maintenance lasts.
What to Do After the Decree
Read your decree first so you know what you are required to keep in place. Then, for everything else, update each designation directly with the insurer, plan administrator, or financial institution. Include employer life insurance, retirement accounts, bank and brokerage accounts with pay-on-death or transfer-on-death designations, and deeds. Retirement accounts being divided by court order have their own steps, covered in dividing retirement accounts and QDROs.
A new will, powers of attorney, and any trust are work for an estate planning lawyer. Our guide to updating wills and beneficiaries after divorce and the after the divorce checklist list what to bring to that meeting.
This page explains Montana law in general as of the 2025 Montana Code Annotated. It is not legal advice about your specific case.