Short answer. Because the law treats naming that person as your insurance beneficiary the same as making them a donation. Article 2012 provides that anyone barred from receiving a donation from you cannot be named your beneficiary either — whatever disqualifies them from a gift, such as an adulterous relationship with you, disqualifies them from this too.
What the law says
Any person who is forbidden from receiving any donation under article 739 cannot be named beneficiary of a life insurance policy by the person who cannot make any donation to him, according to said article.
Civil Code, Article 2012 — Life-Insurance Beneficiary Disqualification. Read the full provision →
The link between donations and insurance beneficiaries
Article 2012 treats a life insurance beneficiary designation as functionally equivalent to a donation. The logic is that naming someone to receive your insurance proceeds upon death transfers wealth without consideration — much like a gift. For that reason, the same moral and public-policy limits that apply to donations under Article 739 apply to insurance beneficiary designations. You cannot use a life insurance policy to accomplish indirectly what the law prevents you from doing directly through a donation.
Who is forbidden from receiving donations under Article 739
Article 739 of the Civil Code identifies three categories of void donations. First, those made between persons who were guilty of adultery or concubinage at the time of the donation. Second, those made between persons found guilty of the same criminal offense, in consideration of that offense. Third, those made to a public officer or his wife, descendants and ascendants, by reason of his office. If you fall into any of these relationships with the person you want to name as beneficiary, the designation is void under Article 2012.
The most common scenario: the paramour
The most frequent situation this comes up in is where a married person wants to name a person with whom they are in an adulterous or concubinage relationship as the primary beneficiary of a life insurance policy. Article 739, item 1, voids donations between people who were guilty of adultery or concubinage at the time of the donation — and Article 2012 extends that bar to the insurance beneficiary designation. The designation is void. The spouse of the donor or donee may bring an action, and guilt may be proven by preponderance of evidence.
What happens when the designation is void
A void beneficiary designation means the insurance proceeds will not go to the named person. Depending on the policy terms and applicable law, the proceeds may instead go to the insured's estate or to alternative beneficiaries named in the policy. This can create uncertainty and disputes among heirs. If you are uncertain whether a particular person you want to name as beneficiary falls within the prohibited categories, that question needs to be resolved before you complete the designation — not after a claim arises.