Legal Question in Wills and Trusts in Indiana

Life Insurance vs debt

I am paying for my husbands life insurance however my budget is very tight. We don't have anything joint. The house is in his name only and so are all his credit accounts. My question is would his life insurance be frozen to pay off his debt even tho I made all the payments? How would they do the house since it was acquired during our marriage? Thanks so much for you help, these questions have been worrying me. If his creditors are going to take the insurance payment, I'm going to stop paying on it my budget is to tight.


Asked on 6/05/03, 5:03 pm

1 Answer from Attorneys
John Cook Dunn & Cook

Re: Life Insurance vs debt

If the beneficiary on the insurance policy is an individual, then that person would receive the proceeds of the life insurance policy, and your husband's creditors would not be able to reach the money. However, if the insurance policy lists your husband's estate as the beneficiary, then those proceeds would go to his estate when he passed away, and would be subject to the claims of his creditors.

Also, very important, is who owns the insurance policy. If you own it, then you control who can be listed as a beneficiary. If you husband owns it, then you should make sure you are listed as the beneficiary, or buy it from him for $100, and then do with it as you like.

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Answered on 6/05/03, 5:26 pm


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