Warning
After a divorce, many states default a former spouse from remaining the beneficiary of retirement funds, life insurance and other benefits (in MO 167; 461.051) unless the participant owner redoes or fills out a new designation reappointing the former spouse.
However, these statutes which may have protected a new surviving spouse in the past from seeing a deceased spouse's hard earned benefits go to a former spouse due to oversight, are preempted by ERISA if the retirement funds are in an ERISA governed plan. In other words, ERISA preempts any state law which provides that the beneficiary designated spouse of a non probate ERISA governed asset is revoked automatically upon divorce. Egelhohh v Egelhoff ex. Rel Breiner, 121 S. Ct. 1322 (2001).
Conclusion
A pension plan governed by ERISA will be distributed to the beneficiary named on the plan designation papers whether the beneficiary is a former spouse or not and whether a state statute is to the contrary. Your divorce client should be so advised.
