Ashly had a few insurance questions. But the one I am about to answer is: ” If You live in Ann Arbor, do you need to pay off a person’s debt with their life insurance proceeds?”

Ann Arbor, Michigan is nicknamed “Tree Town” the name stems from the dense forestation of its parks and residential area.

Answer to Readers Question : No, the person who is named as the beneficiary in a life insurance policy does not have to pay off any debts. The proceeds belongs to them directly.

Whatever estate is left usually to pay off debts and then the balance of the estate is distributed to heirs. If the beneficiary of the policy is the estate, then it becomes an asset of the estate and should be used to settle the deceased’s debt.