Miami, FL asked in Social Security for Florida

Q: Would my grandmother lose her SSI payments because of life insurance pay out?

My grandmother is getting SSI and recently my grandfather passed away who had life insurance. I have been paying for the life insurance for the past 20+ years. Now the check came in on my grandmother's name.

If she put this into her account would she loose her SSI payments? Would I not be able to use the money to pay for funeral expanses?

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1 Lawyer Answer
James L. Arrasmith
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Answered
  • Social Security Disability Lawyer
  • Sacramento, CA

A: Life insurance proceeds are generally not counted as income for SSI purposes, so your grandmother's SSI payments would not be affected by the life insurance payout. However, if your grandmother's total resources (including the life insurance payout) exceed the SSI resource limits, then she may lose her SSI benefits. As of 2023, the SSI resource limit is $2,000 for an individual. If your grandmother's resources exceed this limit, she may be ineligible for SSI.

If the life insurance payout is used to pay for funeral expenses, that would also not count as income for SSI purposes. However, if the funds are not used for funeral expenses and are kept in her bank account, they would count towards her resources and could impact her SSI eligibility.

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