Can A Nursing Home Take Your Life Insurance Policy? 
There are limits on how much cash value can be in a Whole or Universal Life insurance policy in order to not exceed Medicaid asset guidelines . Term life insurance is not counted as an asset at all , since there is no cash value in Term insurance . If you do have a permanent policy with thousands of dollars of cash value , you have a number of choices . You can transfer ownership , but if entering a nursing home now , that will not protect it . You can possibly change it to a funeral policy , which is allowed . Or you can legally use the cash value to pay for nursing home care while holding onto some of the base coverage . Your social worker and life insurance agent can work together to make this the most favorable situation for you . 