The items that make up an estate can range from a home and vehicles to checking accounts and a coin collection. One commonly overlooked asset is the proceeds from a life insurance policy. To find out how such an asset is addressed after the death of a loved one, read on.
Assets Subject to Probate
The wide-ranging array of assets most people own are treated differently during probate depending on what they are and how they are designated. Probate is the legal process that addresses the deceased's estate to ensure that beneficiaries may inherit and that the creditors of the estate are paid what they are owed. Unfortunately, probate can take several months to run its course, and often it can be expensive to pay the court fees associated with it.
Because of those things, probate is often spoken of in negative terms, and methods of keeping assets out of probate are plentiful. It must be emphasized that probate may be required in some case;, however, the probate may be shorter or simplified if there is little to no property left open to probate.
To keep estate assets away from probate, steps can be taken to place special provisions on property. These include:
Life Insurance Proceeds
The proceeds of a life insurance policy are yet another means of keeping assets out of probate and may be the oldest of the methods. Life insurance has never been subject to probate but instead goes to the named beneficiary on the policy. This benefit has made life insurance proceeds a convenient way to help survivors pay for the final expenses of their loved one. The only time that life insurance policy proceeds would have to be probated is when the beneficiary proceeds the deceased in death.
For more guidance on creating an estate plan that makes things simple for your loved ones after your death, speak to an estate attorney like those at Johnson/Turner Legal.Share