A 2016 CBS 60 Minutes report revealed that audits of the largest U.S. life insurers led 25 carriers to dole out over $7.5 billion in unpaid benefits. Before that, a 2011 audit ordered by the Texas Comptroller’s Unclaimed Property Division uncovered over $178 million worth of unpaid proceeds due to Texans. Show
There are steps you can take to find a lost policy and obtain its benefits if you believe you may be the beneficiary. Why Life Benefits Go UnclaimedLife insurance proceeds can go unclaimed for a few reasons. Sometimes beneficiaries don’t know they're named on the policy, or that one even exists. They may have moved from the address listed on the contract, so the insurer can't locate them. They may not know how to file a claim if the insurer goes out of business and transfers its policies to another without notifying beneficiaries. The insurer may lose contact, ending the paper trail, if the policyholder moves and doesn't submit a change of address. In some cases, the insurer doesn’t know they've died because no one sends a death notice. Who Can Claim a Lost PolicyA beneficiary should file a claim after a death, but an estate lawyer, trustee, or family member might file the claim instead. Funeral homes may do so when the proceeds will pay for burial expenses. But only beneficiaries can collect the benefits even if someone else files the claim. What you must submit to file a claim can vary by insurer. You may need to provide a few things:
NoteSome insurers will allow you to submit a claim over the phone or online, while others will make you do so via snail mail. Search for Unclaimed Benefits OnlineYou can turn to the National Association of Insurance Commissioners (NAIC) Life Insurance Policy Locator Service if you’re unsure if a loved one had one. This online service asks that you enter data about the deceased, such as their name, last known address, dates of birth and death, and Social Security number. The NAIC then submits this information to participating insurance companies. Each carrier then searches its records to see whether your loved one’s data matches the data of any of its policyholders. The NAIC’s locator service doesn’t provide instant results. It can take up to three months before they find a policy for your loved one, then it may ask you to send a copy of the death certificate before you can move forward with a claim. NoteThe NAIC’s free locator service helped more than 46,600 beneficiaries find policies and annuities with payouts of more than $650 million by 2019. It's best to use this service shortly after a loved one passes. Go to the National Association of Unclaimed Property Administrators (NAUPA) website if you don't begin your search for years after a loved one has died. The site includes a map that links to the unclaimed property units in every state. They oversee all types of unclaimed funds, including life insurance. You can search its records. You can file a collection request if you find proceeds or other funds that are owed to you. The agency will likely contact you via email, telling you how to claim your money. They may request a copy of your ID, your Social Security number, and proof that you reside or once resided at the address associated with the lost property. NoteProcessing times vary by state. It can take up to 180 days in California. Other Places to Find InformationNAIC and NAUPA can help you find a lost policy, but they can take three to six months to do so. It's often easier to find it through old-fashioned detective work. You have a few options here.
Frequently Asked Questions (FAQs)What happens to unclaimed life insurance policies?State laws differ in terms of how unclaimed life insurance policies are handled and when local governing bodies take over. Most policies are eventually claimed, and many insurers will work to track down beneficiaries when policies remain unclaimed. Eventually, the proceeds will be turned over to the state and handled according to its unclaimed property laws. How long do you have to claim unclaimed life insurance money?There is usually no time limit for claiming life insurance benefits. As long as the policy was in effect, and payments were current when the insured person died, you can claim it anytime. How do I look up a deceased person's policy?You can find out if someone had a policy by using online search tools, contacting their financial or legal advisors, or checking the deceased's records. Life insurance policies are not usually public record, but they can be found on sites that aggregate records of unclaimed money in each state.
How do you find out if you are the beneficiary of a life insurance policy?Once you find a life insurance policy, you can see if you're a beneficiary by contacting the life insurance company directly. If it turns out you are a beneficiary, you'll need to submit a claim to receive any proceeds from the policy.
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