People wrongly think that their Will overrides beneficiary forms. This is categorically untrue! An asset carrying a beneficiary designation will not be controlled by your Will (unless the beneficiary is your estate). This includes life insurance, bank accounts, brokerage and investment funds, annuities, IRAs and 401ks — any asset for which you have named a beneficiary. It also includes property owned jointly between you and another person unless it is titled in certain ways.
Suppose, for example, that you have $300,000 in property that will pass under your Will. Your Will says everything should be divided equally among your three children. But you also have a life insurance policy for $150,000 that names only one of your children as beneficiary. That one child will inherit all of the life insurance money ($150,000) and one third ($100,000) of the assets passing under your Will. So instead of each of your children receiving $150,000, one of them receives $250,000 and the other two each only receive $100,000. Your intention to treat them all equally has been defeated by the beneficiary designation on the life policy.
The same result would occur even if your Will had specifically said that the life insurance policy should be shared equally. This is because a beneficiary form designation always out ranks your Will.
When making your estate plan or revising your Will, it is crucial to coordinate with beneficiary designations in order to avoid unintended results. Just how they should be coordinated can depend upon a number of factors. Your estate planning attorney should be consulted to assist you.