Answer

Laura -

The form packet you should have received then is the Ohio "Release from Administration" forms. Because he was not survived by a surviving spouse, the form can be used only if "entire gross estate is less than $35,000.00". With no personal property or real estate remaining, and since his cash reserves were probably exhausted prior to the time he passed away, chances are the only asset he still had at time of death was this life insurance policy.

One huge concern that pops into my thought process is that if your father was in the nursing home that long, he probably was on the Title 19 (also called Medicaid or Medical assistance) program for at least a good portion of that time where the state was paying the nursing home costs. In that event, the state would have a claim against the estate for reimbursement of their expenses on dad's behalf in an amount that probably exceeds $35,000. Normally life insurance proceeds pass around that obligation when they pay directly to the named beneficiary, but because the beneficiary designation failed, the life insurance proceeds become an asset of his probate estate. I'm afraid that means that the life insurance proceeds will end up having to applied to offset the State of Ohio Medical Assistance 'estate recovery' claim, which will most likely consume the entire proceeds. If that is the case, you don't want to go through this process just to have to turn over all the money to the state and keep nothing for yourself or others in the family.

In fact, the existence of a State of Ohio claim against the estate (for reimbursement of nursing home expenses) may make dad's estate inelligable for the Release from Administration procedure. One of the requirements to utilize that procedure is that "The decedent’s creditors will not be prejudiced by approval of the application." If the use of the form causes money to be paid over to family that should have been paid over to the state, then the state as a creditor is definitely 'prejudiced' by the approval.

(As part of 'Release From Administration' procedure, a notice must be given to the Medical Assistance Estate Recovery Program administrator to tell them that there may be money available for them to claim. If dad was in the nursing home and on Medical Assistance benefits to pay those costs, the state will most likely have the priority when it comes to claiming the life insurance money.)

Here is a page on the court website on the requirements and procedures for using the 'Release from Administration' procedure:
see http://www.franklincountyohio.gov/probate/departments/release_admin.cfm#Long_Form

Before we look at how to complete the forms themselves, double check that the forms packet you are looking at is the Ohio Release from Procedure forms, and also confirm whether or not dad was on Medical Assistance benefits while he was in the nursing home.


I hope this has been helpful. Let me know if you have any followup questions. If none, please remember to click on the ACCEPT link so that I may receive credit for working on this topic with you. (I'd greatly appreciate it!)


Thank you,

Dan

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The information provided is general in nature only and shall not be construed as legal advice or to create an attorney-client relationship. You should always consult with a lawyer in your state.

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