1. 3998 POINTS
    Matt Benore
    Founder, DenverWest Insurance Professionals, Inc.,
    No, although creditors may find out you received the tax-free death benefit and try to convince you that you have to pay the debt of the one who passed away.  IF debt is owed, that is where probate comes in.  Generally the proceeds received from a Life Insurance policy are free from probate.  Probate will go after the Estate and may decide that some of the monies in the estate, ie. the sale of a house, car, etc.. go to pay that past debt.
    Answered on December 11, 2013
  2. 63333 POINTS
    Peggy Mace
    Most of the U.S.
    If you were a cosigner for the debt that was incurred by the person who died, then you will most likely be responsible to repay the debt with the life insurance proceeds that were left to you. If you did not share in the debt that was incurred by the person who died, then the life insurance money that was left to you belongs to you.
    Answered on December 11, 2013
  3. 10968 POINTS
    Tim Wilhoit
    Owner, Your Friend 4 Life, Brentwood TN
    It would be highly unlikely you as the beneficiary would be responsible for the insureds debt upon their death. However, if co-debt is involved as a spouse or a loan co-signer then the bank or loan institution learning of your death proceeds could try to sue you for your proceeds.
    In most cases, unless the debt is yours personally, you cannot be responsible for the insureds debt upon their death.
    The benefits of life insurance proceeds are they are tax free and do not pass through probate if the beneficiary is set up properly. It is your money now to be used anyway you please.
    Answered on May 9, 2016
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