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How to find lost life insurance policies

By Jim Sloan on June 23rd, 2010
Life Insurance

Each year millions of dollars go unclaimed because family members don't realize that a deceased relative had a life insurance policy. There are dozens of reasons why life insurance policies get lost or forgotten and the death benefits never reach their intended beneficiaries. It could be the deceased person never got around to telling his wife or children about the policy, or never gave them the details. Sometimes people purchase a policy, and after it has been paid up they simply forget about it.

Unfortunately, there is no central source for information on life insurance policies. But it's never too late to find out if a policy existed. If you are a beneficiary, you can collect benefits any time after a relative or friend's death--even if it's years later.

If you think a loved one had a life insurance policy, here are some simple steps you can take to find the policy and ensure the benefits are distributed to the right person:

1. Check bank statements

Review bank statements and the checking account ledger of your deceased loved one to see if periodic payments were made to an insurance company. Policy premiums can be paid monthly, quarterly, semi-annually and annually, so go back as far as you can.

If you don't have access to these records, check the mail for the next year or so to see if any bills arrive from an insurance company. Look for annual statements of coverage for paid-up policies or for notices of lapsing policies. Remember to check to see if your loved one had automatic withdrawals set up to make premium payments.

2. Review address books

By reviewing address books or computer contact lists, you may come across the name, phone number or email address of an insurance agent. You may even consider contacting the agent who sold your relative auto, home or health insurance policies because many agents may sell life insurance as well. You should also check with attorneys, bankers or financial advisors your relative may have done business with.

3. Check with the deceased's employer

People often buy life insurance or may receive life insurance coverage as a benefit through their employer.

Your relative also could have purchased insurance through an association they belonged to, so check with them as well. If the deceased was a member of a union, check with the union's welfare office.

4. Review income tax records for the past two years

When reviewing tax records, look for entries showing dividends paid by life insurers, interest earned on a cash value, or interest charged on loans taken against cash value.

5. Contact the deceased's State Treasurer's Office

If the insurance company knows that their client has died, but are unable to find the beneficiaries within five years, they have to send the death benefit to the state's unclaimed property fund.

6. Check with the state insurance department

Your state insurance department can give you a list of all companies authorized to conduct business in your state, but it's likely impossible that you'll have time to write to each of them. If you have an insurance company's name but can't locate the company, your state's department of insurance can tell you if the company has moved, changed its name or merged with another company and provide you with a current address and phone number. Best's Insurance Reports, available in most large libraries, provides an annual list of companies, including mergers or changes in name or address.

7. Pay someone to conduct a search for you

One company, MIB Group, can help you find out if your loved one applied for an insurance policy and with whom. MIB, an insurance membership corporation, offers a policy locator service for $75. The company's database contains more than 170 million records of life insurance applications. For more information about this service, visit MIB's Web site. There are also other "policy locator" services that generally look for policies by faxing inquiries to hundreds of life insurance companies.

Preventing the problem in the first place

You can ensure your own life insurance policy doesn't get lost by giving your beneficiaries a copy of the policy or showing them where your policy documents are stored. Keep your financial records in a central place so your family members can easily find it if needed.

Another option is to use a service like FindYourPolicy.com, which is a life insurance policy registry. For a monthly fee, you store your name, insurance companies and beneficiary email addresses. FindYourPolicy sends e-mail reminders to beneficiaries about the companies that hold benefits for them.

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