Florida laws grant beneficiaries a large number of privileges and protections. Therefore, whether you are a designated beneficiary to a will, a trust, or an insurance policy, it does not matter – Florida law has statutory rules to protect your rights.
In this article, you will find out the essential topics regarding beneficiary laws in Florida.
Beneficiary vs. Heir – Do Both Terms Refer to the Same Concept?
In Florida, the terms “beneficiary” and “heir” are used interchangeably. Nevertheless, the state’s probate law distinguishes between the concept they refer to.
Therefore, a beneficiary is a person named in the last will with a right (or potential right) to receive property transferred in the document. Differently, an heir is a person who stands to inherit property from a deceased person who died without a will (intestacy).
Typically, a decedent’s heirs tend to be his/her relatives whereas the term “beneficiary” has a broader meaning, as a beneficiary does not necessarily must be a relative.
In terms of rights and benefits, both beneficiaries and heirs share virtually the same level of legal protection (except in situations where the right to a benefit relates specifically to the decedent’s last will).
In both cases, a personal representative, trustee, or any other person who holds a fiduciary duty to the beneficiaries must keep them well informed as an estate administration happens, notifying them about events and making them part of the process.
It is interesting to note that the fiduciary duties owed to beneficiaries of a will by a personal representative are similar to the duties owed by a trustee to the beneficiaries of a trust.
What Are the Beneficiary Laws in Florida? – The Essentials
Right to Receive Timely Notice
When someone dies in Florida, what happens next depends on whether the decedent had estate planning tools in place. If the deceased person died owning assets solely in his/her name, the estate would likely go through probate.
However, if the decedent had designated beneficiaries to trust(s), payable-on-death (POD) and transfer-on-death (TOD) accounts, insurance policies, or other similar tools, his/her estate may be distributed directly to the beneficiaries.
During probate, the personal representative appointed by the court to administer the estate must provide notice of administration to interested parties, that is, the beneficiaries and creditors.
Similarly, the trustee must notify beneficiaries of a trust that the settlor died and the assets in the trust will be distributed as outlined in the trust agreement. In both cases, if the probate or trust is subject to litigation or any adversary proceedings, beneficiaries must receive proper notice and be informed.
Right to Receive Proper Accounting
Florida law also grants beneficiaries the right to receive proper accounting of the assets from which they benefit – either the assets are part of a trust or subject to probate proceedings.
Therefore, a trustee or personal representative must provide a detailed accounting to all interested beneficiaries, which includes the preparation of an inventory of the property and all related transactions (i.e., expenses and claims paid out, receivables, income generated by the property).
Right to Object
Within 90 days upon receipt of notice of administration, a beneficiary can contest a will (in whole or part) and the appointment of the personal representative – as long as there is a feasible legal ground for legal action. Similarly, a beneficiary may ask a court to clarify the precise identity and share of all the beneficiaries of an estate.