While life insurance policies do typically have clauses that dictate a waiting period before they will pay out in cases of suicide and that prevent a beneficiary from collecting if they are convicted of the homicide of the victim/insured, this scenario meets neither of those criteria. There is no legal or logical reason why the family should be denied the insurance benefits; only emotional ones. The government in this case has fallen victim to a flaw in logic referred to as "appeal to emotion." Allowing the insurance company to skip out on the payment sets a precedent for insurance companies to deny payment to other families whose loved one was involved in morally or ethically questionable behavior. Having dealt with insurance companies for 25 years, I've seen insurance companies flat out lie to avoid paying out. The last thing we need is to give them another reason to cheat people out of what they've paid for. That said, the government has no business even getting involved in this matter. This matter is between two private interests, and there are no allegations of fraud, so there is no justification for government involvement. Once again, the government is using emotion to take liberties they shouldn't be taking.
The federal government is right to sue the family of the San Bernardino shooter from collecting the life insurance payments. As far as I am concerned that is now blood money and the family does not have a right to it. Once you die in the act of committing mass murder/terrorism, that voids any sort of insurance benefits in the result of your death.
Those people did a horrible thing but at the end of the day they were still people who had families that need to survive. Those family members were not involved with the shooting in any form or fashion and they deserve to receive the money from the death of their loved ones who once provided for them. They are not profiting off of the deaths of others, they are just getting the insurance that was already paid for.
I strongly believe that terrorist's or other murderers families should not receive life insurance payments. Often times those who kill others will also kill themselves. Allowing their families to receive payments would be in a sense rewarding the family for their relatives bad behavior. Since the person would no longer be able to suffer for what they had done, I feel that somebody should. This would give the victim's family some relief in knowing that their is still a punishment for the crime. If a person shoots up a school and kills 7 children and then themselves, I really don't think their family should be rewarded for that crime.
The family of one of the San Bernardino shooters should not be able to collect the life insurance payments. The policy was taken out a short time before the events, indicating the shooter was on a suicide mission. This should be considered a terrorist act, and his beneficiaries should not receive a financial windfall.