Life Ins beneficiary question

[wooisme]

Sigh,

This is complicated but here goes:

My brother in law a long time ago had an insurance policy through work which he has had for more than 30 years and at the time his two son's were little guys like 4 and 8 at the time. He left my father in law (his father) the beneficiary of the insurance policy solely and was meant for my father in law to give to the boys and to take care of the boys because they were too young to receive this kind of money.

WELL, my brother in law has just had open heart surgery and is not predicted to make it. I happened to call his work to find out who was listed on the policy and it's still my father in law but he is deceased! He never changed it over into the boys names and they are 27 and 24 now.

So, I found out in a round about way that it's my father in law's decendants that get the money. Well, that is no problem because it would be turned over to the boys because that was my brother in law's intentions BUT BUT, my husband is one of the decendants and that alarms me because we are in a chapter 13 bankruptcy and what would this mean. The money is not meant for my husband, it's meant for the boys and would be given to the boys....

I am in a panic about this....because I don't know what that is going to mean ...we are almost two years into the plan now. I can't see reporting this fact to the trustee, it's not my husband's to keep.

Any suggestions, thoughts, etc.????

P.S. My brother in law does NOT have a will either

[chloe0724]

YOu need to call your attorney ASAP. I know some insurance is exempt, but I don't know about life insurance. And since you're not actualy listed as the beneficiary, it most likely will be considered an inheritance. And I don't think those are exempt.

[wooisme]

well if that's the case then my husband is not going to be claiming it, his sister will. this money is not meant for either my husband or his sister, it's meant for my brother in laws children, the two boys. He just never removed his father from the policy as the one getting the money. So she can claim the inheritance

[wooisme]

bumping up because I would like to know what the other moderators think about this. No, I do not want to call the lawyer right now, I do not want him or anyone else connected to it to know at this point if I don't have to tell them because it will put me on radar with the trustee. Would it be best for him NOT to claim it or to refuse it. That way he has not touched the money.

[StartingOver08]

Is there anyway that the life ins company beneficiaries can be changed to the kids names now?

[wooisme]

how? because my brother in law is not awake, he is out! he is drug induced sleeping and that's what we fear, that he will die before he wakes up. the only thing I can think of is if my husband disclaims it and i disclaim it it would then revert back to my sister in law and she would either claim it and give it to them or she could disclaim it and it would go to the boys. it's a big fat mess but I cannot see claiming this and then giving it to the boys, it would look way too suspicious and it will leave a paper trail and I have to tell you I am just SICK over this.

[Flamingo]

Here's the situation in a nutshell for you; your brother-in-law, if he should pass, would die intestate (without a will). That means his estate falls under state laws as to its distribution. It usually is passed to a surviving spouse, if there is no spouse, then to the children. However, as to the life insurance policy, a beneficiary is indicated. The life insurance company would follow the directive of the deceased as to the beneficiary and turn the life insurance proceeds over to the estate of his father (your father-in-law) upon notification of death. The executor of your father-in-law's estate would then be responsible for taking care of the distribution of those funds to the beneficiaries of your father-in-law's estate. You know it would not hurt you to go to an attorney for an estate consultation (would be well worth the fee - usually about $100 or so) as to this situation to get advice on this situation and since the boys are now adults and are aware of the situation, go along with you to see what, if anything, you can do as to this situation. Best of luck to you!

[wooisme]

Here's the thing, my husband is the executor of the estate for my father in law. I mean how in the heck can we get around this...my husband cannot claim this money nor can I and you know what that is... can my sister in law claim the entire sum of the life ins policy since she and my husband are the only two people in my father in laws estate. Can she claim it solely and then turn it over to the boys.

In my father in laws will it states that everything is to be divided up between three children. my husband, his sister and the brother who died and if any one of them didn't take it or were deceased it would go to the remaining siblings...sigh, this whole thing is a nightmare

[Flamingo]

Here's the thing, my husband is the executor of the estate for my father in law. I mean how in the heck can we get around this...my husband cannot claim this money nor can I and you know what that is... can my sister in law claim the entire sum of the life ins policy since she and my husband are the only two people in my father in laws estate. Can she claim it solely and then turn it over to the boys.

You need good legal advice...if you are afraid to have the BK attorney review this matter for you (does he/she just handle BK's or other matters, or are there other attorney's in his/her office that handle Wills/Estates), as I stated get a consultation with an attorney specializing in Wills and Estates so you will know what, if anything can be done in this situation. To guess and dance around asking numerous questions will get you nowhere and could present problems for everyone involved if handled incorrectly.

Since your brother-in-law has not passed away and others realized the original intentions of the funds from the insurance policy, get advice ASAP. Don't rely on advice on a forum in a situation such as this. I myself would certainly see an attorney about this. There is too much at stake for you/your husband and the two boys to fool around.

[fltoo]

Saw a show on financial planning once. Young, unmarried woman started a job, designated her sister as benie on her retirement plan. After 50 years of marriage and contributing to her plan, she dies, her sister got the money and left the brother in law in the lurch.

Good idea for everyone to update their benies on investment and insurance policies.

[wooisme]

I came here because I guess I thought perhaps someone had the same type of experience but I know my husband cannot claim this................I mean really you cannot MAKE a person TAKE money if it doesn't rightfully belong to them so I guess he will go to jail because he is NOT going to interfere with those boys getting what is rightfully theirs to begin with so I guess I'll be visiting him in prison and there will be nothing I can do about this if it comes down to this because he will NOT listen to me.

Thanks for allowing me to rant

[oldrocker]

bumping up because I would like to know what the other moderators think about this. No, I do not want to call the lawyer right now, I do not want him or anyone else connected to it to know at this point if I don't have to tell them because it will put me on radar with the trustee. Would it be best for him NOT to claim it or to refuse it. That way he has not touched the money.

Talking to your lawyer wont put you on the trustees radar, your lawyer is on your side not the trustees. You need to find out how its handled in your district. In my district per the trustee we only tell him about recieving life insurance proceeds if they are recieved within 180 days of filing.

11 USC 541 property of the estate:

(5) Any interest in property that would have been property of the estate if such interest had been an interest of the debtor on the date of the filing of the petition, and that the debtor acquires or becomes entitled to acquire within 180 days after such date--

(A) by bequest, devise, or inheritance;

(B) as a result of a property settlement agreement with the debtor’s spouse, or of an interlocutory or final divorce decree; or

(C) as a beneficiary of a life insurance policy or of a death benefit plan.

[wooisme]

so what you are saying is in your district over 6 months from date of filing after that you can keep it. is that what you are saying...anything after 180 days you can keep it in your district

[oldrocker]

so what you are saying is in your district over 6 months from date of filing after that you can keep it. is that what you are saying...anything after 180 days you can keep it in your district

Yes

[Flamingo]

so what you are saying is in your district over 6 months from date of filing after that you can keep it. is that what you are saying...anything after 180 days you can keep it in your district

I believe that is only for Chapter 7 BK's and not Chapter 13's. My father-in-law passed away 1 1/2 years into our Chapter 13 and we had to report everything as to my husband's inheritance from him. The Trustee kept 1/2. Consult with an attorney as I stated prevoiusly since you are in a 13.