Must life insurance be used to pay parent's creditors and bills?

Attorney Tom Olsen: Lisa, you're on WDBO. Go ahead.

Lisa: Yes, thank you. I have a mom who fell and was not able to get back to walking, so she's in a long-term facility at this time. I was just wondering, she does have a life insurance that, it's not a large amount, but definitely an amount that would help for funeral arrangements when that's needed. I wanted to know if the state of Florida or even the nursing home facility or government agencies can actually confiscate that policy.

Tom: Lisa, as long as she's naming somebody as beneficiary, for example, you or all of her children, therefore that life insurance is passing outside of the probate process, the answer is no. Nobody can take it to reimburse for mom's long-term care. If your mom failed to name a beneficiary, which would be a mistake, but if she failed to name a beneficiary, and now that life insurance has to go through probate, and whenever we do a probate, all creditors have an opportunity to file a claim in the estate. That would include Medicaid, nursing home, et cetera. Before the money could be doled out to her kids, those people would have to be paid first. As long as she's named beneficiaries, then that money will go to you free from the claims.