Legal Question in Wills and Trusts in New Jersey
life insurance
My mother passed away last month. I am the beneficiary of her life insurance. I need to know if the creditors that she owes money to can go after the life insurance. Does it have to become part of her estate?? Thank you for your time and help.
3 Answers from Attorneys
Re: life insurance
The life insurance would go to the beneficiary named, and would be outside the estate. Creditors against the estate would have to file a claim against the estate for whatever assets are in the estate. The life insurance would not be part of the estate.
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Re: life insurance
Life insurance generally passes outside of the estate. You will however have to check to see who the beneficary is. If the estate is the beneficiary then the creditor can go after the proceeds.
Re: life insurance
I concur with the previous writers. If the policy proceeds are paid to a named beneficiary, rather than to the estate, the proceeds are not part of the probate estate against which creditor's claims are paid. The proceeds may be part of the taxable estate if the decedent was the owner of the policy, for purposes of estate/inheritance tax assessments. More information about the estate is needed before I can give you a better answer.
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