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Do Life Insurance Policies Go Through Probate?

Published by Robert J Stillwell on May 31, 2024


The simple answer is NO. Life insurance policies and payouts generally do not need to go through probate. After all, life insurance is there to support beneficiaries after the insured or policyholder dies. Ideally, we don’t want our loved ones going through a long, expensive, and drawn-out court process just to get what is meant for them. 

Unfortunately, there are scenarios when this is necessary. 

We will discuss why probate could happen in this article. But first, if you fear that your life insurance policy or someone you know life insurance policy may go through probate, it is best to speak with one of our Robert J Stillwell representatives, who can answer any questions you have on purchasing a life insurance policy or assisting with beneficiary claims after a loss. 

What is Probate in Regards to a Life Insurance Policy? 

Probate is the legal process of dividing and transferring the ownership of inherited assets after someone’s death. A court official often oversees the deceased’s estate. First, they make sure debts (if any) are paid off and then distribute what’s left to the beneficiaries of the will (if there is one) through an executor. 

However, not all assets are subject to probate. Quick side note before we continue: life insurance proceeds could be subject to estate taxes—probate or not. 

How to Avoid Probate in Life Insurance?

Although state laws may differ, the following actions are key to avoiding probate: 

  • Designate a specified beneficiary 
  • There’s a well-detailed and up-to-date will or an irrevocable trust that clearly specifies who receives the payout. This is the main requirement
  • The life insurance policy is still active 
  • The cause of death is covered by the policy 
  • And there’s no conflict among potential heirs 

Once these conditions are in place, the funds are paid to the beneficiaries named on the policy without a court overseeing the process.

When Will Life Insurance Policies Have to go Through Probate?

Life insurance policies will go through probate if beneficiaries are not named, vague, invalid, or the designated beneficiary is deceased or cannot be found. Lastly, if the estate is listed as the designated beneficiary. Note that a “vague” beneficiary could lead to conflict among heirs contesting the designation. 

If one or all of these conditions are present, the life insurance proceeds will go into the insured’s estate. 

Other factors like an inactive policy or when the cause of death falls under a clear exclusion does not necessarily mean it will go through probate. However, it may affect whether the insurance company pays or denies the payout altogether. 

How to Receive the Proceeds from a Life Insurance Policy as the Beneficiary?

If you’re the beneficiary of a life insurance policy, the benefits are not paid out automatically. To get the payout, you’ll need to file a claim with the insurance company by providing the original death certificate. You may also need to provide the original life insurance policy or sign off on a lost policy affidavitIt’s best to contact the company for specific forms and requirements. 

Once the insurance company receives your claim paperwork, it will be reviewed by a claims processor which could generally take 30-60 days to process depending on the company and the complexity of the claim. After reviewing the claims paperwork, the insurance company will either pay, deny, or request additional information. If your claim is rejected, the company will provide a reason. 

You may also be offered different options for receiving the payment, such as a lump sum, installments, or an annuity. 

There can be many unique scenarios when involving life insurance. If you have any questions, you should discuss with your insurance company or another insurance professional. Of course, should you need further assistance, our representatives at Robert J Stillwell are happy to answer any questions to ensure beneficiaries get the benefits intended quickly and efficiently.

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