Life Insurance and Family Provision Claims

In the case of life insurance it depends upon who owns the policy of insurance. If you own the policy the proceeds will be paid to your executor or administrator to be distributed in accordance with your will. However sometimes such policies are in the name of your spouse or business partner and in that case the proceeds will not form part of your will. The proceeds will be paid directly to the owner of the policy. Life insurance funds are protected assets from a trustee in bankruptcy and should remain outside of your estate where possible just to be safe from a challenge against your estate. This is also relevant in the event some contests your will. These funds are not part of your actual estate however may be designated notional estate but only in NSW. See notes on notional estate.