My mother recently passed and as such I’ve been faced with a lot of different and new problems that I am frankly a bit baffled by and am hoping some Dopers might have a little insight for me.
First, concerning utilities . . . My mother had some pretty heavy utility bills and did not own any property or vehicles or have money in her bank account. However, she did have a life insurance policy. Is the policy considered part of her estate? Will I as her next-of-kin be responsible for her utility bills? We lived together as a family but were each responsible for different costs so I was assuming that I would have to close her account and open it in my name instead, but was wondering how this sort of situation worked. Do I have to pay those crazy bills? Mom loved running air conditioners and stuff, so I am a little worried!
Second . . . My mother began making payments on a stone for her burial in 2008, and made maybe two payments total after that for a grand total of roughly $35. She had left the account dormant for at least four years prior to her death. She never had a lot of money and ultimately decided to go with cremation, so in the end the stone did not appear to be needed and was never paid for. However, I did not know this and inquired with the company about the stone and was considering buying an urn for Mom’s ashes from them. We were going to go with direct cremation and no services as per Mom’s wishes, but after speaking with the family it seemed everyone really wanted a service in her honor, so we decided to go elsewhere and included with the services with the new company was a much more affordable and also much nicer urn.
However, my girlfriend offered the gravestone company $20 as a down payment at the time toward Mom’s account. It was meant to act as a “please hold this urn” fee to get us started, but as I said, we decided to go elsewhere and so did not want this urn. When I tried to give a courtesy call and let them know my intentions, they were quite upset and were expecting me to satisfy the previous cost for Mom’s account as they had cut a stone for her when she originally began paying for the grave stone. Am I responsible for this? If I buy their overpriced urn, everything gets wiped away, but it doesn’t seem like I should be forced into it. I feel like I should be able to get the alternate urn which is far nicer and probably more in line with what Mom would have wanted.
I am also seeking legal advice from a local attorney as we speak, but would love to save some time if anyone has any idea about these sort of situations. If it helps, I also live in Pennsylvania.
Concerning the life insurance if you were the designated beneficiary it will go directly to you outside the estate and the away from the debt collectors:
Speaking to an attorney is the right thing to do, however AFAIK the estate is responsible for settling all “legitimate” debts of the deceased. If there is life insurance monies then the estate is obligated to make sure everyone who should get paid, does get paid. That’s assuming the estate is the beneficiary.
The power company may decide to forgive the debt, it doesn’t hurt to ask, but I believe they can legally force the estate to pay it off, which in my opinion is the right thing to do anyway.
As far as the stone/urn goes, without seeing the contract she signed it’s hard to determine if they have the right to force the estate to pay or not. An attorney should be able to help there.
From my limited experience, I don’t think most rotating creditors are inclined to hassle grieving loved ones for uncollected balances. If a person dies essentially penniless, utilities would rather write off the nickels and dimes, than to dun the survivors for the proceeds from the yard sale. However, if it is an estate with a will and an inheritance that has to be probated, the executor will be liable for paying off the household bills from the estate before anything is distributed to the heirs…
Utility bills can just be marked “deceased” and returned to the billing office and written off. Probably also any other debts as long as they are not running up into the hundreds or thousands of dollars. I doubt that a case can be made that survivors can be held personally responsible for the debts of an indigent deceased, unless they actually realize value from it, such as a car payment. If they could, the named executor could just refuse to serve.
Again IANAL, but this comports with my family experience.
Since this is looking for advice, and also potentially involves legal issues, let’s move it to IMHO. Keep in mind that, as the forum name indicates, it’s just the advice from some random folks on the internet, and should not be considered the equivalent of professional legal advice.
Moving thread from General Questions to In My Humble Opinion.
This is what I recall reading for insurance. Some insurance policies are payable “to the estate” but in general, the insured picks a beneficiary, and on her death, the money goes directly to the beneficiary. It’s yours, never the estate’s.
(I recall one co-worker being upset because the clever insurance company policy did not allow multiple beneficiaries - she had to designate her older daughter with the understanding that the older daughter would then give half to the younger daughter… I smell a fight in the making.)
Other than that - when someone dies, creditors have a designated time to present bills to the estate. The executor then satisfies the creditors, and whatever (if anything) left is split according to the will. If there is not enough money to satisfy the creditors, well, sucks to be them. I have heard of bill collection agencies especially trying all sorts of pressure tactics - you owe us, do you want your dear mother to remembered as a dead-beat, etc. - but basically, what she owes dies with her estate.
If your name is not on the bills, you did not owe them. Your mother can’t run up debt in your name. You can ask the company to change the new services to your name. I presume “she didn’t own any property” means you are renting; I assume there’s some onus on you to change the name as soon as possible so there’s no suggestion you’re freeloading.
As for the urn situation - it depends what’s in writing (or isn’t). If you or your girlfriend signed a contract then she/you are on the hook. Technically a verbal agreement is a contract, but as Mayer said, “a verbal contract ain’t worth the paper it’s written on.” If you are under the impression it was a simple good faith “please hold” payment, not a final commitment to complete the purchase, I guess it’s up to the small claims court judge who to believe if it gets that far. (IMHO $20 is not much of a commitment).
So collect the life insurance policy, change the utilities, and wait to see what happens with the rest.
So what’s wrong if the estate is broke? Lots of estates are broke–you don’t realize how many people live paycheck to paycheck (or Social Security check to Social Security check).
Again OP to extent are there assets in the estate? If she died virtually broke it’s a stupid idea to spend thousands of dollars on a attorney.
Read the URL I cited above about the life insurance: if there are named beneficiaries (like you) then the money goes directly to them and the debt collectors can’t access it. If not then the money goes to the estate where the debt collectors have to be paid.
I am listed as the sole beneficiary of her insurance and there is no will or other assets to the estate. As for the urn, the only thing that’s signed is a balance statement and I am unaware of any prior contract with my mother for her original payments and do not believe there is anything else that has been signed. It is just a statement balance sheet so I do not know if this counts as a contract or not. I was under the impression that this just reflected a payment had been made on Mom’s account and would be used to guarantee a ‘hold this item’ situation with the urn. There is nothing contractual on the form that I see at all.
Other relatives have told me I should be fine to just dismiss this company, and go ahead with the purchase of the other urn but I am wary to do so as I would hate to have to pay these people for the stone that Mom had originally made payments on years ago. It seems like the guy was just trying to scare me into closing the deal. This is the first time I’ve ever had to deal with these kinds of issues in my life, but it has been an eye opener.
We do rent as well so there is no property or cars in Mom’s name. Literally, all Mom really had was the insurance policy. It’s scary because I was really hoping to use the insurance money to pay for the service and also get myself another place since I won’t be able to afford it anymore without Mom’s contribution every month. We were one of those families that really stuck together in order to survive.
In any case, just hoping this all works out and that I can go ahead and buy the other urn and make ends meet after all of this stuff dies down. Handling all the details after someone dies is very stressful and confusing in my experience.
The policy could list the local Humane Society as the beneficiary. It doesn’t matter - the money goes straight from the insurance company to the beneficiary listed, it is not part of the estate unless the estate is explicitly listed as the beneficiary, it’s not hijacked to pay the deceased’s bills.
Lots of estates are broke, just like this OP’s example. Many creditors and bill collectors will try various tactics, lies, and tricks to try to get money. If you break down and give them money, well, they are further ahead than they would have been otherwise. Who cares if you don’t? It’s not like mama’s credit score is going to be a problem in the future. they CANNOT add anything to your credit record.
For example, I don’t know what a gravestone costs, but I’m assuming a nice one is at least $1000. Any business that cuts a stone based on $35 worth of payment is either lying or a pretty poor businessman. Basically, they have $35 in their pocket and (perhaps) a blank stone they can sell to the next customer. Plus $20 for an overpriced urn they can sell to the next customer and likely was in their inventory already.
But since when is the estate the beneficiary? The defeats the prinary purpose of having life insurance: providing for your loved ones. Even when I was single, the beneficiary on my (work provided) life insurance wasn’t my estate; the beneficiaries were my favorite niece and my stepdaughter. Now of course it’s my wife and kids. If I choke on a chicken bone at lunch today, the money goes to them, not my estate, and any debtors I alone owe (as opposed to my wife and I together) can’t touch it, as is only proper.
Yes, md2000, I know all of that. My initial post was asking dolphinboy why he assumed that the money from the life insurance policy would go to the estate.