This is one issue that will be addressed in the recent case, New York Life Insurance Company v. Powell, et al., where the Powell and Cox heirs may fight it out over Josh’s, Susan’s and the kids’ life insurance proceeds.

The answer is that death will be presumed if/when Susan has been missing for more than seven years, with no finding of her remains.  That said, it could be determined that she died earlier.  Two settled principles apply:

1.  a person who was alive when last seen is presumed to continue living until the contrary is shown; and

2.  one who disappears and remains unheard of for seven years, and whose absence is unexplained, is presumed to have passed away.

Where the proof shows that the absentee encountered some specific peril to which it may reasonably be thought he/she had succumbed, death may be inferred short of the expiration of the seven-year period.  See Occidental Life Ins. Co. v. Thomas, 107 F.2d 876 (9th Cir. Idaho).  If that is the case, it will be up to a judge or jury to make that determination.

If it is determined that Susan passed away before Josh, then arguably her estate should pass to Josh, her surviving spouse (assuming there are no Slayer Statute issues that prevent Josh from inheriting).  And because Josh then passed away, his estate would pass to his heirs  (or beneficiaries named in a will or trust, if one exists).    It works in reverse order if it is determined that Susan passed away second.

It seems simple, but things get complicated quick when we consider (1) the life insurance policies, which have beneficiary designations; (2) effect of those policies being community property (Josh may only be able to control his one-half of the policies); and (3) the Slayer Statute (Josh will be treated as having predeceased his kids because he intentionally caused their deaths; he will also be treated as having predeceased Susan if it is proved he intentionally caused her death).  These considerations complicate things.  TEP will post more as things unfold.  Stay tuned.