Life insurance is personal property. Personal property can be owned by one or more owners. Living in a community property state could present divisible property issues if the life insurance policy has cash values. Each community property state may have it's own proprietary regulations. Consult an attorney before moving forward with any policy ownership changes.
Life insurance in community property states is typically denoted as community property if community funds purchased the policy. Community property is that which was purchased after the marriage, whether or not only one person is the insured, and whether or not only one person paid the premium (unless the premiums were the result of a personal gift). The exception is if the beneficiary is the spouse; then the life insurance proceeds go to the spouse-beneficiary.
Not all states use this method of determining community property, so check with legal counsel to find out the guidelines for your state.
Business Development Officer, T.D. McNeil Insurance Services, Fresno, California
California is a community property state. There are only a few states in this group. In California a life insurance policy would be considered community property unless it was purchased entirely with non-community property assets. This would be very unusual. The thing that is important is that the policyholder in California cannot act independently of their spouse. That is the policyholder cannot change the beneficiary, take out a policy loan or surrender a policy without the signature of their spouse.
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Not all states use this method of determining community property, so check with legal counsel to find out the guidelines for your state.