Is a trustee entitled to any life insurance proceeds that become payable after discharge?

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Is a trustee entitled to any life insurance proceeds that become payable after discharge?

My husband and I filed for Chapter 7 about 5 months ago; we were discharged on the 5th of this month. Unexpectedly, my husband passed away on the 6th.There is life insurance that I am entitled to receive. Will the trustee take that money? Do I need to inform the trustee about money coming in? If I don’t inform them, can they come after me for the money?

Asked on February 22, 2013 under Bankruptcy Law, Michigan

Answers:

FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 11 years ago | Contributor

If you received a bankruptcy discharge before payment of any insurance money with respect to the passing of your husband then under federal bankruptcy law you are entitled to the full amount of the insurance premiums for yourself and not the trustee. You get to keep the entirety.


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