My mother only has life insurance in her name. Can a nursing home take it from the family if it's used to bury her with?

If she isn’t on Medicaid yet, cash it in & prepay for a funeral/cremation. Cash value of insurance does count toward asset limits.

Is Mom on Medicaid? Is the policy say its for funeral expenses? Does it have cash value? Is it thru a lawyer.

If Mom is on Medicaid the policy should have been brought to their attention. If its got cash value, Medicaid may want you to cash it in and use to prepay her funeral. If it was overlooked, call Medicaid, let them tell you how to handle it.