Paying full six month auto insurance before filing

[tonyk81]

I seem to have an attorney that is not too good about returning phone calls and emails... I am filing chapter 7 in St. George, Utah.

My attorney advised that I can't pay ahead on bills. In otherwords I can't pay any extra on the utilities, rent, etc. This I understand and am fine with.

However my question is am I allowed to pay off my 6 month auto insurance policy? My policy renews on April 8th, and currently I don't qualify for monthly payments due to my credit.

In your experience would a trustee raise an issue if the policy is paid off for the entire six months? Is there a chance they would try and recover the money for 5 months worth of premium to pay amongst creditors?

[keepmine]

Your lawyer is being cautious. If you have no history of prepaying bills then, the trustee will infer you're trying to spend down.
But, since a monthly payment isn't an option, go ahead and pay the 6 months in advance since state law requires insurance and if the car is financed, I'm sure the lender requires you to keep it insured. If the question comes up, you have a reasonable response.

[debtfreeindy]

To answer your question, yes, there is a chance that the trustee would try to recover the money for the estate but among the many ways debtor's spend down assets prior to filing, this is one of the more legitimate ways