Life Insurance Proceeds and Your Debts

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Whether your life insurance proceeds can be used to pay the debts of your estate depends on whether you’ve named a designated beneficiary.

What is a Designated Beneficiary?

If you complete a form for the purpose of specifying the name of a beneficiary for your life insurance policy then the beneficiary is known as a designated beneficiary in legal language.

If there is a designated beneficiary for an insurance policy then, at your death, the proceeds from that policy belong to the beneficiary. Unless you’ve named your estate as the beneficiary, your life insurance money cannot be used to pay your creditors or any of the bills of your estate. Also, the account would not pass through the probate process even if the rest of your estate is probated. However, if you don’t fill out a designated beneficiary form, or if your beneficiaries don’t survive you, then the insurance money would be included in your estate. This means it would go through the probate process and could be used to pay off the bills of your estate.

Part of establishing and maintaining a solid estate plan is making sure that your life insurance policy is up-to-date, and knowing where the money will go in the event of your death. An estate planning attorney can help you with these tasks.

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Our Practice Areas in Colorado Springs and Denver

At Hammond Law Group, we focus on helping Colorado families build strong, forward-looking estate plans that protect assets and preserve family harmony.

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Getting Started Has Never Been Easier — Attend a Workshop or Webinar

At Hammond Law Group, we believe that the foundation of good estate planning lies in knowledge and understanding. Our approach starts with education. Join our highly informative workshop on wills, trusts, estate planning, and more, where we provide you with comprehensive information to get you started in designing your personalized plan.

By attending our workshop or webinar, you not only … exclusive offer of a complimentary consultation with an experienced attorney
(a $500-750 value).

Our workshops fill up quickly so reserve your seat today.

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Your Experienced Estate Planning & Elder Law Advisors

We have a team-centered approach. While each client’s family works with one attorney, our attorneys regularly discuss the design of our plans with each other in order to ensure we’re doing everything possible to help you meet your goals.

In addition, each client works primarily with one paralegal, who gets to know you and your estate plan intimately through the design and
implementation process. The biggest complaint people have about
lawyers is lack of communication, and by working as a team we have
virtually eliminated this complaint for our clients.

Learn more about our family and then let us learn more about yours.

Meet Hammond Law Group Team

At Hammond Law Group, our estate planning attorneys work together to create meaningful, lasting estate plans for Colorado families. Each member of our team shares a commitment to personal connection, clear communication, and compassionate service.