If your father is considering filing for bankruptcy protection he is required under federal bankruptcy laws to declare all assets and liabilities with respect to the petition including his life insurance policy.However, depending upon what type of bankruptcy petition that he files (Chapter 7 for example) his life insurance annuity proceeds might not be subject to payment to creditors. I suggest that he consult further with a bankruptcy attorney concerning his assets and liabilities to ascertain whether a bankruptcy filing will be to his benefit and if so, what type of a bankruptcy filing, liquidation or reorganization.