Florida Exemption of Life Insurance

Jordan E. Bublick, 20801 Biscayne Blvd.,  Miami, Florida 

Florida Statutes provide for certain limited exemptions of life insurance as to (1) cash surrender value and (2) proceeds upon death.

Cash Surrender Value Exemption

Section 222.14 of the Florida Statutes provides that the "cash surrender value" of life insurance "issued" upon the lives of citizens or resident of Florida is exempt from the claims of creditors of the person whose life is so insured (some courts hold insured must also be the owner of policy)

• creditors of the beneficiary
• unless the policy was effected for the creditor's benefit.

Florida courts broadly construe the required nature of the "form" of the "cash surrender value" to include any cash value that may be obtained either by means of negotiation or pursuant to an agreement for surrendering the policy.

Proceeds of Life Insurance Exemption

Florida Statutes section 222.13 provides for the exemption of the proceeds of life insurance from the creditors of the "insured" upon the death of a person residing in Florida. Courts hold that this statute provides for the exemption from the claims of creditors of the insured but not from the claims of the creditors of the beneficiary. This means that the proceeds are available to the claims of the beneficiary's creditors.