Yes, somone can disclaim, or refuse or give up, an inheritance, such as real estate they don't want or is not economically worthwhile. Since you state that you are listed on the policy as a beneficiary, the insurance proceeds don't go through or become part of the estate: they go directly to you and to the other beneficiary per the insurance policy, which is a contract. Disclaiming the inheritance of the real estate will have no effect on receiving benefits as a life insurance beneficiary. You can get instructions on disclaiming from the probate court.