I act on behalf of Executors. The deceased’s car was destroyed in the explosion (from a natural gas leak) that also killed my client. In the deceased’s Will, the car was left to a friend of the deceased. Should the proceeds from the car insurance become the gift to the deceased- or will they in fact be part of the residuary estate?
It is usually a question of fact where a specifically gifted asset is damaged (or destroyed) – what happened first – the “damage” or the death of the testator.
If the damage occurred after death, then the asset passes to the beneficiary together with the benefit of any insurance claim.
However, if the damage occurred before death, the asset in its condition at the time of death passes to the beneficiary and the benefit of any insurance claim falls into residue.
In the case in question, whilst it would seem reasonable to assume that the car was damaged shortly after the explosion (albeit it perhaps only seconds, or even a fraction of a second, later) – did the testator die instantly as a result of the explosion, or subsequently as a result of their injuries (perhaps only a few minutes after the explosion)?
If death was instant, I suggest the remains of the car and the insurance claim would pass to the beneficiary.
If, however, the testator survived the initial explosion and died of their injuries, I suggest the beneficiary is entitled only to the remains of the ca, with the benefit of any insurance claim forming part of the residuary estate.
I believe the coroner’s office should be able to advise whether the testator survived the initial explosion.
Paul Saunders FCIB TEP
Independent Trust Consultant
Providing support and advice to fellow professionals
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