Question
What is the name of your state? Georgia
If I purchase life insurance policies on my mother and my step-father, neither of whom have much of anything, will I be legally obligated to pay either of their bills? I plan to use whatever proceeds I would get from the policies to care for the survivor if the need arises and to pay funeral expenses. My step-father has no health insurance and my mother has Medicaid, they are at the poverty level and I am sure that they have substantial debt and judgments against them. I am the only one in my family who has the financial ability to pay for the policies and would be looked to to pay any funeral expenses. My mom and step-father have been married for 30+ years and I assume I would have an insurable interest as far as his policy would be concerned. I just don't want to be legally obligated to pay their debts because I am beneficiary on their life insurance policies. Any information provided would be appreciated.
Answer
You might not be able to prove insurable interest. You might have to have each parent own their own policy. Then, once its been through underwriting and has been issued, ask for the agent or the insurance company to provide them with change of ownership forms. At that point, they can change the ownership over to you. No, you are not responsible for their bills. But, the surviving spouse may be.