Do we need to open an estate?

Q: Our dad passed Mar 7 and mom on March 13. An insurance policy needs to be paid to my sister and I. Do we need a Small Estate? No real estate involved. Bank accounts have been closed. They were both in an assisted living facility and most of their estate was spent on their care. The insurance company is insisting we need a Small Estate Affidavit. The insurance policy was issued by Dad’s employer in the amount of $2150. We do not want to probate the will for this small amount. What do we need to do and can we do it ourselves or do we need an attorney? Since our mother died so soon after our dad and we had no time to have the insurance paid to her, is this complicating the issue? Their will names my sister and I as co-executrices. (Pittsburgh, PA)

A: If there are living beneficiaries on the policy, the proceeds can be paid directly to the be beneficiaries without court or lawyer involvement. If the named beneficiaries are deceased, then the insurance company will only release the money to the estate. If the amount of the proceeds is under $11,000.00, section 3101 of the PA Probate, Estate and Fiduciary Code allows the insurance company to pay certain next of kin directly, without opening an estate. The insurance company may be from out of town and not know PA law. If you show them the statute, they may change their minds. If they still will not release the money, you can have an attorney file a small estates petition in Allegheny County as there are assets under 25k and no real estate. It may be a long shot, but some insurance companies have allowed me to obtain such proceeds with a document they have or which I craft if necessary, titled, Waiver of Probate and Release.

If you feel like this issue relates to you, or a problem that you are experiencing, please contact me so that we can discuss your situation.