A Guide for Unlocking Unclaimed Life Insurance

Ideally, when loved ones pass away, beneficiaries of life insurance policies should have the necessary information to promptly file a claim and receive the benefits owed to them. Unfortunately, this is not always the case, resulting in over a billion dollars going unclaimed in the U.S. due to beneficiaries being unaware of their inclusion in a policy or facing difficulties in locating the required documentation.

In response to this issue, the National Conference of Insurance Legislators introduced the Unclaimed Life Insurance Benefits Act in 2011. This act standardized procedures for unclaimed policies, compelling insurers to regularly check the Social Security Administration’s Death Master File database to identify deceased policyholders and their beneficiaries. Despite these measures, millions in life insurance benefits continue to go unpaid annually.

For those who suspect they may be beneficiaries but are unsure how to proceed, several methods can be employed to determine if life insurance payouts are owed:

  1. Gather Records to Start the Search: To look for a specific life insurance policy, individuals will need the deceased’s official death certificate, which includes their full legal name, Social Security number, and dates of birth and death. A government-issued ID is also required to verify identity when submitting a claim.
  2. Check Financial Documents and Personal Contacts: Reviewing financial paperwork like income-tax returns and bank records may provide clues if the beneficiary has an idea of who named them and the insurer in question. Contacts such as friends, family, coworkers, and previous employers can also be valuable resources.
  3. Use the NAIC Life Insurance Policy Locator Service: The National Association of Insurance Commissioners (NAIC) provides an online form for those who believe they may be beneficiaries of unclaimed life insurance policies. The information submitted is then shared with participating insurance companies for a comprehensive search.
  4. Check with State Unclaimed Property Departments: Each state has different rules for considering a policy dormant, typically ranging from three to five years. If a policy has been declared dormant, individuals can search for unclaimed funds in the state where the deceased last resided or where they purchased the policy.
  5. Explore Other Search Options: Websites like the National Association of Unclaimed Property Administrators’ Missing Money site and online policy search tools from various life insurance companies, including John Hancock, MetLife, and New York Life, can aid in the search process.

Once a potential life insurance policy is identified, beneficiaries can initiate the claims process by gathering necessary documentation, such as multiple copies of the death certificate. Filing a claim can be done through an insurance agent or directly, with details about the beneficiary’s identification and preferences for receiving benefits, whether as a lump sum or through an annuity.

While there is no strict deadline for filing a life insurance claim, prompt action is encouraged for a faster payout. Insurers typically have up to 30 days to review and process claims, emphasizing the importance of a timely and informed approach to securing entitled benefits. In conclusion, for those uncertain about their status as beneficiaries, user-friendly online tools and proactive communication with family members or representatives can facilitate a smooth and efficient search process.

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