From what money are final expenses paid first?

1 answer | Last updated: Nov 28, 2016
Love asked...

I have been living with my girlfriend for 8 years. She has passed and I have a life insurance policy on her from my work and she owns land with her siblings passed down from her parents. She has never paid a dime for this policy and has no other policy to pay for expenses. Who is required to pay his final debts, creditors and funeral arrangements? Does this come out of the life insurance policy I have paid on all these years or the property that is in her name?

Expert Answers

Steve Weisman hosts the nationally syndicated radio show A Touch of Grey, heard on more than 50 stations, including WABC in New York City and KRLA in Los Angeles. He is a practicing lawyer specializing in estate planning and is admitted to practice before the United States Supreme Court. He's a public speaker and commentator who has appeared on many radio and television shows throughout the country, and he's the legal editor of Talkers magazine, the preeminent trade publication of talk radio. His latest book is The Truth About Avoiding Scams.

We often hear about our money that you can't take it with you, but when it comes to debts, you can leave them behind.

The debts of your girlfriend and her funeral expenses are exclusively her debts. Those debts belong to her estate and not to you regardless of how long you may have lived with her. If, however, you agreed with the funeral provider to be personally responsible for her funeral costs, you may have a problem there. But if you only acted on behalf of her estate, you do not have a personal liability for her funeral costs.

A person's debts and final funeral expenses are required by law to be paid from their assets before anything is distributed to their heirs. In the case of your girlfriend, it appears that her only asset is her share of the real estate. It is from that asset that her debts and final expenses should be paid. The life insurance policy that you carried on her life naming you as the beneficiary of the policy is not a part of her probate estate and is not required to be used by you to pay for any of her debts and expenses.