Does life insurance go through probate?

Life insurance does go through probate in certain situations, typically when your beneficiary is unavailable to accept a payment. However, you can take steps to ensure your life insurance stays out of probate.

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Rachael Brennan has been working in the insurance industry since 2006 when she began working as a licensed insurance representative for 21st Century Insurance, during which time she earned her Property and Casualty license in all 50 states. After several years she expanded her insurance expertise, earning her license in Health and AD&D insurance as well. She has worked for small health in...

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Written by Rachael Brennan
Licensed Insurance Agent Rachael Brennan

Benjamin Carr was a licensed insurance agent in Georgia and has two years' experience in life, health, property and casualty coverage. He has worked with State Farm and other risk management firms. He is also a strategic writer and editor with a background in branding, marketing, and quality assurance. He has been in military newsrooms — literally on the frontline of journalism.

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Reviewed by Benji Carr
Former Licensed Life Insurance Agent Benji Carr

UPDATED: Jun 29, 2022

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Quick Facts

  • As long as your beneficiary is available, your life insurance policy will not go into probate
  • If your life insurance does go into probate, it can take months or years to resolve and cost your beneficiaries money
  • You can avoid probate by keeping your life insurance policy up to date

The passing of a loved one can be a traumatic experience, and if you have to take care of their estate, it can also leave you exhausted and drained. Many people want to know as much as possible to streamline the process. This includes questions like does life insurance go through probate?

Of all the things you have to take care of, your life insurance is the last thing you want to worry about. Ideally, life insurance will pay out death benefits without any complications.

We’ll explain what could cause life insurance benefits to wind up in probate and how you can avoid it right here.

So, does life insurance go through probate? If you’re ready to find the best life insurance policy, you should shop around for quotes. Enter your ZIP code into our free tool to see what quotes might look like for you.

What can cause life insurance to go through probate?

As a general rule, life insurance does not go through probate.

As long as you have named a beneficiary who is still alive when you pass away, it will bypass probate.

Unfortunately, there are situations where your life insurance death benefit might wind up in the hands of the courts. The question of whether life insurance goes through probate or not is frequently overlooked.

If the policy hasn’t been kept up-to-date and the listed beneficiary has already passed away, the benefit could go to your estate. When life insurance goes into probate, it can take a long time for your loved ones to see the money.

When you’ve bought insurance to protect your family and provide for their future, you must make sure your policy will be ready for them after your passing. Keeping your policy updated ensures it will stay out of probate.

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What happens when life insurance goes to the estate?

Usually, life insurance is not a probate asset, and it doesn’t go to the estate. When someone dies, their life insurance pays their beneficiary after the claim is settled. There’s no reason for a probate court to get involved.

If you are the beneficiary of a life insurance policy, it’s simple to make a claim. You need to send a copy of the death certificate to the insurance company and fill out any forms.

The insurance company verifies the death and completes the claims process. Once that is done, you’ll receive a check. At that point, the claim is considered closed.

As long as the death benefit stays out of probate, creditors can’t touch it. The entire payout goes to the beneficiary.

However, there are situations where the life insurance company can’t pay the death benefit. In this case, the death benefit goes into the estate, and the court decides what happens to it.

When a life insurance policy goes into probate, creditors can claim money meant for beneficiaries. This can be especially devastating when it affects life insurance for low-income families.

If the policy goes to the estate, it may be used to pay off debts. Anything leftover can then go to heirs in the will.

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What is the probate process?

If you want to make sure your life insurance doesn’t go into probate, you need to understand the probate process.

Probate starts after death. A probate court handles a person’s will and estate to ensure all assets end up where they should. When someone contests a will, a probate court resolves the issue.

If you haven’t designated an executor for your will, probate court will appoint a legal representative.

The legal representative resolves the debt a person leaves behind after they die. A person’s debt can be substantial and complicated, especially if the death was unexpected.

Studies find that 73% of Americans die with some form of debt, including credit card debt, mortgages, car loans, student loans, and personal loans.

It’s the responsibility of the legal representative to make sure that debt is resolved. Once the debt is settled, everything leftover from the will goes to the heirs.

This job requires time and effort, especially if the deceased left behind a tangle of debts. Typically, legal representatives take a few months to manage an estate.

However, this process can take years in some cases, especially if the estate is complex.

The longer this process goes on, the more money it takes to retain a legal representative.

How to Avoid Probate

You can keep your life insurance policy out of probate by having a living beneficiary that can accept a payout. When such a beneficiary isn’t available, your policy will enter the probate court.

Many people assume that there’s nothing to worry about after purchasing  a life insurance policy. However, there are several reasons why your original beneficiary might not work:

  • Your beneficiary passes away before you
  • You choose a minor who cannot accept a payout
  • Your beneficiary is unavailable or can’t be found

The good news is that it’s fairly easy for your life insurance to avoid probate in most cases. If you keep your policy up to date, your beneficiary probably won’t have to deal with a probate court.

More specifically, you can take the following steps to avoid probate:

  • Select an adult beneficiary. If you want to leave your policy to a minor, consider putting the payout into a trust in case you die before they come of age.
  • If your beneficiary dies before you, make sure to choose a new one.
  • Ask if your policy includes a per stirpes designation, which passes your benefit to your beneficiary’s children if they’re unavailable.
  • Consider selecting co-beneficiaries.
  • Name an alternative beneficiary, just in case.
  • Update your policy after major life events. For example, if your ex-spouse is your beneficiary, they’ll receive the benefit even if you’ve remarried.

Life insurance entering a probate court is uncommon, so as long as you follow these guidelines, your beneficiaries will have nothing to worry about.

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Find the Best Life Insurance Policy

Probate or no, life insurance is still one of the best options to provide your loved ones with financial help after your passing. If you have a policy, simply keep it up to date, and your entire death benefit will make its way into your beneficiary’s hands.

If you want to make sure you have life insurance that won’t go through probate, you should start by shopping for quotes. To get started enter your ZIP code into our free tool for life insurance quotes from top companies.


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