Can Nursing Homes Take Your Life Insurance From Your Beneficiary?

Now straight to the point of this article, no a nursing home cannot take your life insurance from your beneficiary for any reason. The named beneficiary on your life insurance policy is the sole heir to the life insurance death benefit. When you purchase a life insurance policy from a life insurance company it is an outside entity compared to your income assets.

This means the only people in charge of your life insurance policy are you the policyholder and the actual life insurance company that’s it. Now we will go over some things that will affect your life insurance policy payout of the death benefit to your beneficiary in this article but you can rest assured that a nursing home will never take your life insurance death benefit from your beneficiary.

Can Nursing Homes Take Your Life Insurance from Your Beneficiary? What can Happen?

As we mentioned at the beginning of this article the nursing home cannot take the proceeds from your life insurance policy for any reason from your beneficiary. Now that being said what can actually happen to your life insurance death benefit? Well, whole life insurance will last your entire life and build cash value on top of your death benefit. This means you have your whole life insurance pay out benefit typically between $10,000 in life insurance death benefit or $15,000 life insurance payout.

Now in addition to this life insurance policy benefit you have an extra savings building with it which is your cash value in the actual policy. All whole life insurance policies allow you to borrow from the cash value of the policy when it is built so you can use that money for whatever you want. That means your whole life insurance policy functions like a financial instrument you can lean on in tough situations. Remember though this is the kicker, your are borrowing that cash value from your life insurance policy which means you are expected to pay it back at some point.

If you do not pay back the cash value you borrowed from your life insurance policy the insurance company will deduct the amount you borrowed from the life insurance payout to your beneficiary. This means if you borrowed $1,000 from your policy’s value and you have a life insurance payout benefit of $10,000 your beneficiary will receive $9,000 total when you die. So the nursing home cannot take any of your life insurance death benefits but the life insurance policy provider can and will if there is a loan on the policy.

All life insurance policies work this way when it comes to life insurance benefits for whole life final expense. Term life insurance has no cash value and if you are in a nursing home you will not qualify for that type of coverage anyways.

Life Insurance for Someone in a Nursing Home

The only type of life insurance policy you can qualify and get if you are in a nursing home is guaranteed issue life insurance. This a life insurance policy with no health questions or underwriting required. Guaranteed issue life insurance policies have an automatic 2-year waiting period but you cannot be denied coverage. This type of life insurance is permanent life insurance which means it will never expire and the premium will never increase as long as the guaranteed issue life insurance is in force.

Life Insurance Companies that sell Guaranteed Coverage

We represent the 3 best companies to be your life insurance provider for final expense insurance. In order to purchase life insurance coverage with these top life insurance companies you must fill out the form to the right and work with our licensed insurance agent.

These companies with the top life insurance coverage include:

American General Life Insurance (AIG)

  • Low Life Insurance Rates
  • Accelerated Death Benefits

Gerber Life Insurance

  • Low Premium Rates
  • Premiums Never Increase

Great Western Life Insurance

  • Low Rates
  • Accidental Death Benefit
  • Premiums Never Increase

These 3 companies have the lowest life insurance rates available you can see pricing by using our quoter on this page.

All life insurance policies have a nursing home question on them which basically asks if the applicant is currently in a nursing home. The question then asks if the nursing home resident requires assistance with activities of daily living such as eating dressing or toileting. If this question is answered yes then GI coverage is the only option.

A nursing home is also considered a long term care facility which again disqualifies you from all other underwritten life insurance. The only solution if you are in a nursing home is a guaranteed permanent policy.

How to Get Life Insurance for Someone in a Nursing Home

If you are looking at buying life insurance for yourself or a loved one you know the financial burden it can put on a family member for end-of-life expenses. That is when it comes to final expenses for family members you want to make sure the funeral home gets paid in full in a timely manner. This spares your loved ones from having to take out loans or borrow money to pay the funeral home and cover final expenses.

To get life insurance for yourself or a loved one just fill out or quote form and speak with our agents to guide you through the signature process to sign up.

In addition to this if there is owed nursing home expenses or assisted living facility expenses then your family can use the full death benefit to pay the nursing homes or facilities for any money owed. That is the true beauty of life insurance your family members can use the money for anything that is needed when you die.

Burial insurance with no medical exam is the key to your family having peace of mind knowing they can use the face value of that policy for financial security. Guaranteed issue burial insurance with no medical exam only has that 2-year waiting period once you are past that at any point if you pass away your family will be taken care of.


A nursing home cannot take your life insurance from your beneficiary but be mindful if you take a loan out of your life insurance benefits. If you are in a nursing home can need life insurance to cover costs for your family when you die then get guaranteed issue coverage. You may have a waiting period and higher premiums but your family will be protected when you die from the high costs of a funeral with the life insurance benefits.