Agency Owner, A1 Insurance LLC, Arizona, California Agency
Great question life insurance does bypass probate since it does have a designated person to get paid on the death know as the beneficiary. Make sure its up to date and review your policy with your agent on an annual basis.
You also might want to consider a trust if you have young kids.
Life insurance will bypass probate if there is a living beneficiary or beneficiaries to receive the life insurance proceeds, as stated in the policy. If the death benefit is left to the estate (or if there are no living beneficiaries on the policy, which also causes it to go to the estate), the life insurance proceeds will go through probate.
Business Development Officer, T.D. McNeil Insurance Services, Fresno, California
A life insurance policy is a legal contract. It is not subject to probate unless it pours money into the estate of a deceased. This feature saves the family the embarrassment of public disclosure that is brought on by probate. It also shields these assets from the claims of creditors to the estate. The life insurance company can deliver money quickly and quietly, and that is very good!
As long as the life insurance policy is set up properly yes the proceeds are paid directly to the beneficiary. If the policy is not set up properly such as naming the estate as the beneficiary or not staying up to date and the beneficiaries are also deceased then the proceeds would be subject to probate and under control of the court. This is a very good reason to use an experienced life insurance broker to stay on top of these types of issues with your life insurance policy.
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You also might want to consider a trust if you have young kids.