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March 7, 2012 at 11:02 AM

Josh Powell's siblings seek to collect on life insurance

From The Associated Press and Times archives:

A life insurance company is asking a judge to decide whether any of Josh Powell’s relatives are entitled to collect on a $1.5 million policy after he killed himself and his two sons in a house fire last month.

In a complaint filed in U.S. District Court in Tacoma, New York Life said that on Feb. 14, nine days after the deaths, it received inquiries from Powell’s sister Alina and brother Michael about how to make claims on the policy, which included $1 million for Josh Powell and $250,000 for each boy. The company sent them claim forms, but the complaint does not say that the siblings have actually filed them.

The company asked to turn over to the court’s control the proceeds payable under Josh Powell’s five-year term policy, as well as a $1 million policy covering his wife, Susan Powell, who disappeared from their Utah home in 2009 and is presumed dead. The judge would decide who, if anyone, gets the money from each policy — saving the company from being sued over any decisions it might otherwise make.

“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.

Many life insurance policies contain wording that renders them void in the event of suicide. It wasn’t immediately clear whether Josh Powell’s policy contained any such language; the complaint made no reference to that issue.

Alina Powell did not immediately return an email from The Associated Press seeking comment Wednesday.

On Feb. 5, Powell attacked his two sons, Charlie, 7, and Braden, 5, with a hatchet and then set fire to his Graham rental home during a supervised visit.

He had long been considered by Utah police to be a suspect in his wife’s disappearance. But charges had never been brought against him despite questions over his claims that his wife went missing after he took his two sons camping in the middle of the night in freezing temperatures.

Despite Powell’s death, the investigation into Susan Powell’s disappearance continues.

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