When submitting a Medicaid application in New Jersey, does death insurance count as an asset?

A poster here on AgingCare recently suggested that for legal, medical and financial questions we would be better to advise that you check with the professionals in your area. I would call and check on this were I you, because basically here you are dealing with lay folk with some expertise gained from their own caregiving. I hope you find the answer.

While I'm not familiar with NJ Medicaid regulations, you may get better answers if you explain what you mean by "death insurance." Do you mean life insurance that's payable upon death? If it's a whole life policy that has cash value, it does generally count as an asset and would need to be cashed in and spent. Some states allow you to set up an irrevocable pre-paid funeral trust or prepaid funeral account with a funeral home, and that could be one way to spend it. States vary in how much they allow a Medicaid recipient to have in such a trust.