How do beneficiaries file a life insurance claim?

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Wondering how to file a life insurance claim? If you’re the beneficiary on a recently deceased person’s life insurance policy, you need to file a claim for the death benefit. If you don’t, you probably won’t see the money and you definitely won’t be alone: Unclaimed life insurance benefits total at least $1 billion each year.

If you’re not sure how to make a claim on life insurance, you’re not alone; it’s not something you do often, thankfully.

The financial needs that arise soon after a family member’s death can be significant, so it’s important to access the money that the deceased wanted you to have.

Key Takeaways

Having a life insurance policy’s details can help speed up the death benefit claims process.
A certified death certificate is a key document.
A life insurance agent or representative of the life insurance company can help you fill out the necessary forms.
A life insurance claim may be denied for a few reasons, such as if the person lied on the life insurance application or the deceased person stopped paying premiums.

How to file a life insurance claim

Here are the steps to take when making a life insurance claim.

1. Get the policy details

With any luck, you’re already aware of the deceased’s life insurance policy and where it’s located. Ideally, it will be stored safely, such as in a metal filing cabinet or fireproof lockbox.

However, you could have a slight problem if the policy was kept in a bank’s safety deposit box.

“In most states, safety deposit boxes are sealed temporarily upon one’s death, which could delay settlement,” says Whit Cornman, a spokesman for the American Council of Life Insurers.

If you’re unsure of the policy’s details or where it’s located, look for common places people store important papers:

Nightstands
Desk drawers
Bookshelves

It’s possible the deceased had life insurance through work or bought a policy independently from a life insurance company, so insurance agents and human resources personnel may also help track down policy information.

It’s not a dealbreaker if you don’t have the policy number. If you know the insurance company and have the deceased’s name, social and other identifying details, the insurance company should be able to locate the policy.

2. Check for other policies

Even if the deceased never mentioned them, there may be other insurance policies in place. These can include accidental death and dismemberment policies, which employers sometimes offer as riders to their insurance policies. Check with the deceased’s human resources representative.

If the person was killed while traveling and had travel accident insurance, you may be entitled to additional benefits. Check with the lender that issued the card the deceased used to buy the tickets and travel, as well as with road clubs to which the person belonged.

You should check for government benefits as well.

Surviving spouses and children may be eligible for a small Social Security burial benefit or monthly survivor benefits. If the deceased served in the military, you might qualify for benefits if he or she served in a war zone or if a service injury contributed to the death.

3. Contact the insurance company

You should notify the insurance company as soon as possible after the policyholder died. Once you find the life insurance policy, look for a contact name and number. The life insurance agent who sold the policy can also help with the life insurance claim process and work as an intermediary with the insurance company.

If you don’t know the agent’s name, contact the life insurance company directly. There is almost always a claims number on the first few pages of the policy.

If the deceased had group life insurance through an employer, contact the employer’s human resources department about making a life insurance claim. The deceased’s pay stubs might indicate whether charges for additional group life insurance coverage occurred each month.

“If you are unable to contact the employer, you can contact the life insurance company directly,” Cornman says.

Always remember that you need to notify the insurance company of the policyholder’s death– claims do not pay out automatically.

4. Obtain copies of the death certificate

When filing a life insurance claim, you need a certified copy of the person’s death certificate.

“A death certificate is the standard form of documentation required when filing a state life insurance claim,” Cornman says.

The funeral director can help you obtain certified copies of the death certificate. They usually will be sent to you by the vital records department in the state in which the person lived. You should receive your copies within a few weeks of the death. Usually, there is a fee for each copy.

If your loved one is presumed missing and hasn’t been declared dead, you won’t have a death certificate. Under these special circumstances, you may need an acceptable alternative to the death certificate.

“In this case, a court order stating that the insured is dead or presumed dead may suffice,” Cornman says.

5. Request claim forms

The life insurance company representative can help you obtain the claim forms you need. You must complete the forms and gather all the information that the insurance company requests.

If you’re too upset to fill out the forms yourself, ask your insurance agent or estate attorney to help you. You have to sign the form, however. All the beneficiaries named in the policy have to fill out claim forms.

If you want your claim to proceed quickly, be sure to follow the insurance company’s directions carefully.

6. Choose how your proceeds will be paid

You may have several payment options available after you claim life insurance. They can include a lump sum, which may be a good option if you need to pay immediate expenses. It may also be possible to have the life insurance company pay you principal and interest in installments.

Another option with some policies is life income. This option aims to stretch payments over your remaining lifespan. Some policies also have an interest income option. with this option, the company holds the proceeds and pays you interest, allowing the death benefit to remain intact. Upon your death, it will go to a second beneficiary of your choice.

In most cases, life insurance proceeds aren’t taxable. However, if you choose one of the options that pay you interest, that interest may be taxable as income. Check with your financial adviser before choosing your option, as settlement options sometimes cannot be changed.

7. Submit the completed forms

You need to send back the completed paperwork and a certified copy of the death certificate. Be sure to return the forms and death certificate via certified mail or with a return receipt requested so you can track it.

It’s then simply a matter of waiting for your check to come in the mail. How long does it take to get life insurance money after a death?

“In most states, prompt pay laws require insurers to respond within a certain number of days,” Cornman says. “However, the number of days can vary from state to state.”

It can take a few days to a few weeks to see your check. But if you have done everything correctly, the benefit should be in your hands reasonably soon.

What is the purpose of life insurance?

Life insurance is the ultimate safety net for your family. Should you die, a life insurance policy can provide surviving loved ones with a sound financial foundation.

This type of coverage is crucial if you’re the primary breadwinner in the family. Your loved ones depend on your income for both the basic necessities and the extras of life. Purchasing a term life policy ensures that if you die during the policy term, your family gets the policy proceeds. This means if you purchase a 30-year term policy, it’s only good for 30 years. If you are still alive after the term expires, you may need to buy more insurance. Meanwhile, a permanent life policy, such as whole life, stays with you for your whole life and can build up a cash value as long as you keep up with the premiums. The payout for both types of policies can be used for anything your family needs, from funeral expenses to household bills after you’re gone.

Life insurance isn’t just for those with families. It can also benefit people in many other life circumstances, says Bob Fee, president of Fee Insurance Group in Hutchinson, Kansas.

“Nearly everyone has some life insurance needs, even if you don’t think you do,” says Fee, who also is chairman of the Independent Insurance Agents & Brokers of America.

He adds that even older people can benefit from buying life insurance if they want to “leave tax-free dollars to their family for final expenses and any other issues that come up that were maybe unforeseen.”

Frequently Asked Questions

What kinds of things might cause a life insurance claim to be denied?

Lying on your application is one of the chief reasons claims are denied. If you misrepresent yourself and your situation – such as not disclosing a serious health problem – and the insurer finds out, your claim will be denied. This is true even if your cause of death had nothing to do with the illness you tried to hide.

Insurance companies will likely deny a claim if the person fibbed during the “contestability period.” This occurs during the first couple of years after you purchase the policy. An insurer may also deny a claim if the person died by suicide within the contestability period.

Failing to pay your premiums also can lead to a claim denial. It’s possible your beneficiaries won’t even be aware that you missed payments. But if you fail to pay, your loved ones could be in for a rude shock after you die.

A claim also might be denied if:

The deceased’s primary beneficiary died and never named a secondary
The deceased is divorced and didn’t rename the current spouse as a beneficiary
The deceased failed to disclose that the person engaged in high-risk hobbies and activities

Can you collect life insurance without a death certificate?

Life insurance companies ask the beneficiaries to submit a certified copy of the death certificate issued by the funeral home’s director along with the claim form to receive the death benefit.

How long do you have to claim life insurance?

There is no time limit on when you can collect the life insurance death benefit. You can call the insurance company or start the claims process online. Only beneficiaries can file a claim and the policy should be active at the time of the policyholder’s death.

How long does it take to get life insurance money?

Depending on the insurance policy, you may receive the death benefit payment within three to five days after filing a life insurance claim if you are a named beneficiary. However, it can take longer.

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Chris Kissell

Contributing Researcher

Chris Kissell is a Denver-based writer and editor with work featured on U.S. News & World Report, MSN Money, Fox Business, Forbes, Yahoo Finance, Money Talks News and more.