Life Insurance

If you are the beneficiary and you get the life insurance do you have to pay for the funeral?


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2010-08-14 21:37:55
2010-08-14 21:37:55

Ordinarily, these are two separate transactions. Consider the following situations:

1. If you have undertaken to make the funeral arrangements and signed a contract with the funeral home to pay for them, you have committed to pay from all available funds that you have.

2. If you are the personal representative (in some states, "executor") of the estate, and no advanced payment arrangements have been made, you are responsible for paying the funeral expenses from estate assets. Those assets can include the insurance proceeds if the insurance was payable to the decedent or to his/her estate.

3. If you are merely the life insurance beneficiary and #2 does not apply, you ordinarily have no obligation to pay the funderal bill.

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Generally that is the purpose of the life insurance, to cover the funeral costs. Who else is going to pay?

The beneficiary of a life insurance policy is not responsible for paying for the deceased's funeral cost using the money from the proceeds of the life insurance policy. The estate of the deceased is responsible for paying for the funeral cost from the proceeds of the estate.

The life insurance is part of the estate not separate from it. In the UK and most other countries, all debts starting with the funeral expenses must by law be paid first from a persons estate. Once all funeral costs, debts and expenses are paid from the estate, only then can any monies be paid out (if there are any left after payment of such bills and expenses).United StatesWhen the decedent named a beneficiary on a life insurance policy the payout goes directly to the beneficiary and is not considered part of the estate. Being a named as a life insurance beneficiary does not oblige the beneficiary to pay for the funeral. The next of kin, if any, must pay for the disposition of the body. If the beneficiary is also a next of kin you may be successful in suing them for their share of the expenses.

There is no requirement that they do so. The life insurance is a contract between the deceased and the company.

You submit a claim to the insurance company when the insured dies. They pay the claim to the beneficiary, the beneficiary writes a check to the funeral director for the expenses. You can also assign to the funeral home a portion of the death benefit needed to pay for the funeral. The funeral director then submits the claim and receives the assigned portion. Simultaneously the beneficiary receives the balance of the death benefit. There are even companies that will advance the cost of the funeral, take a reassignment of the original assignment and submit the paperwork for the funeral home.

Life insurance is where you pay premiums periodically for a set number of years and then when you pass away the value of your life insurance policy is awarded to the beneficiary you choose (usually a spouse or your children) to pay for your outstanding debts, funeral, tuition, retirement, etc. so they don't have to pay for those expenses out-of-pocket.

Life Insurance Company will pay such amount to you after you submit the death certificate in insurance company. Fist you have to pay to funeral home and after that you will receive insurance amount from the insurance company. Here is link from where you got the local funeral home information in detail and ask them for the same.

She is not responsible for the medical bill as long as the didn't sign at the hospital saying she was the responsible party. Was the daughter the beneficiary of the life insurance policy? If the beneficiary of the policy was the estate of the insured then the hospital can file a lien against the estate and life insurance to cover the medical bills. If the beneficiary was a funeral home to pay for a prearranged funeral then the hospital cannot attach the policy proceeds. If the beneficiary was the daughter directly then the hospital cannot claim the life insurance proceeds. However, this leaves the daughter with no obligation to use the entire amount for funeral arrangements.

More than likely, no. As the costs of funerals rise over the years, loved ones may still have to dip into a major life insurance policy to help pay for a funeral. The funeral home is usually listed as the beneficiary.

No. Life Insurance will provide for funeral expenses - and some life policies are specifically for funeral expenses.

Yes. If there is a contingent beneficiary, the insurance company will need proof that the primary predeceased the principal in order to pay the contingent beneficiary. If there was no contingent beneficiary named the insurance company will pay the proceeds to the principal's estate.

The answer to the question of whether or not beneficiaries have to pay taxes on the money received from life insurance policies is: no they will not have to.

Unlikely. It doesn't make sense. If you pay $10k in funeral expenses and the life insurance is 10 million - what kind of a deal is that? It would certainly be possible that if the insurance is payable to the estate of the deseased that the person who paid the funeral expenses could get the $$$ from there.

Under normal circumstances, no. A life insurance company will pay the proceeds to the named beneficiary.

Life insurance paid to your estate could possibly be used to pay off personal debt. However, if the life insurance is paid to a beneficiary, it is their money, not yours, so the beneficiary has no obligation to use the money to pay off your debt.

If you have coverage of $250,000 and you die, then your beneficiary will get $250,000.

No. It pays you only what is the policy maturity/insurance amount

Property insurance - If your property is damaged the insurance will pay for this to be repaired. Life insurance - If you die then your estate (or the named beneficiary) gets a payout to the value of the insurance.

Proceeds from a life insurance policy to a beneficiary are usually paid free from federal income tax.

Insurance companies will not pay if the beneficiary is convicted of the homicide. Most insurance companies will pay the beneficiary if that person was not involved and the policy does not exclude homicide as the cause of death.

First, the Durable Power of Attorney was extinguished when the principal died. You can no longer use it. The authority to handle the estate assets is in the executor. If no beneficiary was named on the life insurance policy then the proceeds will be made payable "To the estate of Jane Smith". In that case the proceeds are part of the estate. The appointed executor would have the authority to cash the check and pay the funeral expenses.

No, only the policy owner (usually the insured) can decide who the beneficiary is on a life insurance policy. Life insurance has nothing to do with a will or estate distribution after someone's death. That's why it is imperative to keep the beneficiary section updated constantly based on the life changes; too many people who get divorced forget to update their life insurance beneficiary on the policy and benefit may go to the ex-spouse. Life insurance companies are bound by the contract that is the life insurance policy to only pay the beneficiary specified on the policy. If all beneficiaries specified on the policy are deceased, then the benefit will be paid to insured's estate.

No. Life insurance is paid the the beneficiary named in the policy, your creditors have no claim against the insurance proceeds EXCEPT if the proceeds are paid to your estate.

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