Legal Question in Bankruptcy in Indiana

Life Insurance

According to Indiana law. My father recently passed away and my mother will recieve a small 10,000 policy amount that is automatically put into a checking account for her to write checks on, also, she will recieve 15,000 policy amount written on a 180 day check. Does this have to be included in her bankruptcy. Should she cash checks before or after she files bankruptcy. she will only file bankruptcy if death certificates don,t discharge large portion of the debt. He was the major wage earner in family. Also, she is planning major move back to Texas to be near family so she has recently checked on buying much cheaper house and this will be her homestead. Can they hold this against her. Thank you.


Asked on 7/23/01, 9:32 pm

1 Answer from Attorneys
Dorene Philpot Philpot Law Office

Re: Life Insurance

My advice would be for her to wait until she "burns through" the insurance money, which can be used for living expenses.

By then, the post-death debts will be relatively clear, and she can then file for bankruptcy.

She can keep certain assets, as long as they fall under the exemptions allowed, but she cannot have more than $100 cash on hand as of the time of filing.

Anything beyond that in cash would be subject to seizure.

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Answered on 7/24/01, 2:15 pm


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