This is where a will would come in handy. I am pretty sure the bills of the deceased will have to be paid from the estate. I do not know if the insurance is considered part of the estate. That is a lawyer question or maybe check it out with registar of wills in your county or Google it. Try Suze Orman's web site and see i8f you can answer there. Good luck. Take care.
Linda
P S a lot of credit card accounts have an insurance that covers the balance.