Do we have to pay our sister for care she didn't give?
My elder sister is the trustee to my late mother's estate. My siblings and I have received bills that include paying back my elder sister for care, prescription costs, life insurance and medical insurance premiums supposedly paid by the elder sister. The problem arises from the fact that the elder sister moved our mother into her son's house (in a different state) and paid them for caring for her which also aided in paying their (my nephew and his wife) house payment. This was not agreed upon by all parties! My mother's house in the meantime (1 year and 2 months) was occupied by my sister's other son for more than a year and we are now being charged for taxes and utilities while her son lived there. Myself and the remaining siblings are benefactors on my mother's life insurance, however we have been told that the cost and expense of all the above will be taken from the insurance before it is distributed. Are we (the remaining siblings), legally obligated to pay these bills and can the cost and expenses be legally taken from insurance distributions prior to giving the money to the recipients? Please help!!
Expert Answer
Proceeds from an insurance policy are payable to the beneficiaries named in that policy. No one has the"right" to have expenses paid out of life insurance proceeds before they are distributed to the beneficiaries.
You state that you were told that certain expenses your elder sister claims you owe will be taken out of the proceeds BEFORE they are distributed to you. Who told you that? I doubt it was the insurance company. I suggest you demand, from whoever told you that, proof that taking these expenses out first is required and legal. Also, if you know the name of the insurance company, contact it and state that you want the proceeds distributed directly to the policy beneficiaries.
Whether you and your other siblings will be responsible (eventually) for some of the costs your elder sister claims she paid for your mother is a complicated matter. It would be best If all of you can somehow resolve this informally through your own negotiations, Otherwise, you could end up with lawsuits, a disaster for any family.