Legal Question in Wills and Trusts in California

Re: Debt after death

You are not responsible for your mother's debts unless the account was opened and maintained on your credit with your agreement to pay. The proceeds of the policy are yours and not subject to the claims of your mother's creditors. They are income tax free. Tell the creditors that your mom died without assets and there is nothing from which to pay her debts. They can file for probate if they want to press their claim, but they won't because there is nothing to gain.

Sorry for your loss.

Re: Debt after death

Thank you for your posting on LawGuru.com, and the opportunity for me to help you by responding to your posting.

The answer to your question is that debts don't get passed on, like assets do. Life insurance in particular is paid directly to you, and is tax free, with no obligation to pay the debt out of the proceeds (unless you were a co-signer).

I hope this helps. If you do have other questions, feel that you need legal representation, or want legal advice, please feel free to email me directly at rmiller[at]expertlawfirm.com. It's my pleasure to help in any way that I can. Thank you.

Re: Debt after death

The creditors need to look to your mom's estate for payment. Life insurance proceeds pass outside a person's estate, so they are not subject to collection by creditors. Sounds like you may be safe in doing nothing. If, however, she died leaving any valuable assets, it is possible that creditors can have a claim to the value of those assets and could go after the person who took possession of or sold those assets. You should probably have an attorney review the value of your deceased mom's estate and determine whether you could have any liabilty and what to do, if anything.