Life insurance and creditors

[disneykid52]

What is the name of your state (only U.S. law)? Florida
When a person dies and insurance policy is paid to the beneficiary, does the beneficiary have to get a credit report on the deceased to see if any outstanding bills are listed to pay them?

 

[ErinGoBragh]

What is the name of your state (only U.S. law)? Florida
When a person dies and insurance policy is paid to the beneficiary, does the beneficiary have to get a credit report on the deceased to see if any outstanding bills are listed to pay them?

No.This is the responsibility of the estate.

 

[justalayman]

and to expand on that a bit:

an insurance payout is outside of the probate of the estate. Unless there is some prior agreement the money will be used for some specific purpose, it belongs to the beneficiary to do with what they want.

they have no responsibility to pay any of the estates debts with this money, unless as I mentioned, there is some other agreement in place that comes in to play.

 

[disneykid52]

so if i have "no estate" per-say but lots of creditors after me, like you said the beneficiary gets the money to do with as she (he) pleases? besides,,,how would the creditors even know im deceased?

 

[justalayman]

it's not that the creditors know until they are told but in their attempts to continue to collect debts from a deceased person, somebody usually tells them so they will stop calling.

 

[Betty]

The only time the ins. proceeds would be payable to the estate or creditors would be if the estate or any creditors were named as the beneficiary. If you named a family member to be bene (for example), the proceeds would go to them to do with as they wish. (unless possibly there was some type of agreement, as justalayman noted, that the family member bene use the proceeds for a specific purpose).