Changing Beneficiaries After Divorce in South Carolina

One of the most dangerous assumptions people make after divorce is that their ex-spouse is automatically removed from their life insurance, retirement accounts, and estate documents. South Carolina law provides some automatic protections, but those protections have massive gaps that can send hundreds of thousands of dollars to your former spouse after your death.

What SC Code Section 62-2-507 Actually Does

South Carolina's "revocation by divorce" statute (Probate Code Section 62-2-507) automatically revokes any beneficiary designations in favor of a former spouse on certain types of accounts and documents. This includes wills, revocable trusts, payable-on-death bank accounts, and transfer-on-death brokerage accounts. Legally, the statute treats the former spouse as if they had predeceased you.

This statute was expanded in 2013 to cover non-probate transfers, so it is broader than many people realize. But it has two critical exceptions that can override everything.

Exception 1: Federal ERISA Preemption

If your ex-spouse is named as beneficiary on an employer-sponsored life insurance policy, 401(k), 403(b), or corporate pension, South Carolina's revocation statute is powerless. These plans are governed by the federal Employee Retirement Income Security Act (ERISA), which preempts all state laws.

The precedent is clear from federal case law, including the U.S. District Court case Bostic v. Bostic: if you divorce and die without manually changing the beneficiary on your employer-sponsored plan, the plan administrator is legally required to pay the full death benefit to whoever is on file — even if that person is your ex-spouse and even if your divorce decree says otherwise.

The only fix is manual: contact your employer's HR department and submit a new beneficiary designation form for every employer-sponsored account.

Exception 2: PEBA State Retirement Accounts

South Carolina Code Section 62-2-507 explicitly excludes governmental employee benefit plans from its automatic revocation protections. If you are a state employee enrolled in SCRS, PORS, or the State ORP through PEBA, your divorce does not remove your ex-spouse as your retirement beneficiary.

Active state employees must update their beneficiaries by logging into the PEBA Member Access portal or completing a physical, notarized Active Member Beneficiary Form (Form 1102) or Beneficiary/Trustee Designation Form (Form 1103).

Retired SCRS and PORS members face an additional deadline: you have five years from the date of your divorce decree to submit Form 7201 (Retired Member Change of Beneficiary) to change your payment option or survivor beneficiary. Miss this five-year window and the payment structure set at retirement is permanently locked in.

The Complete Beneficiary Update Checklist

After divorce, you should manually update beneficiaries on:

• Employer life insurance policies (submit new forms through HR)
• 401(k), 403(b), and IRA accounts (contact each plan administrator)
• PEBA retirement accounts (Forms 1102/1103 for active members; Form 7201 for retirees)
• Private life insurance and annuities (contact the insurance carrier directly)
• POD bank accounts and TOD brokerage accounts (update at the financial institution)

Even though Section 62-2-507 covers some of these automatically, manually updating every account eliminates any ambiguity and prevents costly litigation by your heirs.

The South Carolina After-Divorce Checklist includes a beneficiary update tracker that covers every account type and the specific forms required for each.

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