QUESTION
May I purchase term life insurance before filing for Chapter 7 and is there an amount I should stay within?
Asked on May 25th, 2017 on Bankruptcy - Nevada
4 ANSWERS
Commercial & Bankruptcy Law Attorney serving Powell, OH
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Ronald K. Nims
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Yes, you can purchase term insurance before filing a Chapter 7. As long as the amount of life insurance is reasonable for your circumstances, there is no limit to the amount you can purchase (insurance companies generally will not sell you an unreasonable amount of life insurance).
Answered on Aug 15th, 2017 at 7:28 AM
Bankruptcy Attorney serving Madison, WI
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Richard B. Jacobson & Associates, LLC
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You can buy such term insurance as you need, without any likely objection from the Trustee or anyone else.
Answered on Aug 15th, 2017 at 7:27 AM
Having term life insurance is a good way to spend down your budget, especially if you have a family to protect. Until you die, term insurance has no value, but you still need to include it as an asset. However, I suspect purchasing a large policy right before filing might raise some red flags and trigger an audit of your file.
Answered on Aug 14th, 2017 at 12:44 PM