How to make a Life Insurance Policy Claim

By Compuquotes Team on March 26th, 2008

When a loved one dies, the last thing you want to think about is filing a life insurance claim. But it has to be done, and for tax and legal reasons as well as financial ones, the sooner you can do it, the better. If you know how the process works in advance, it can make things a little easier.

The first step should always be a phone call to your insurance agent to find out exactly what paperwork you'll need to complete to make a claim. Alternatively, contact the employer of the deceased if the insurance policy was obtained through an employee benefits package.

If you're not entirely sure what type of life insurance the deceased had, or cannot find out which company they had insurance with, then try looking at their credit card and bank statements to see if you can locate any payments made to insurance companies. Once you know the name of the company the policy was with, a quick phone call to the company will locate the policy. If you really get stuck, then try contacting your state insurance department.

You'll also need a copy of the death certificate (it must be either an original copy or a certified copy), and as the beneficiary you will need to supply proof of your identity as well. If the policy-holder was an ex-partner and you are the beneficiary, you may also need to supply an original or certified copy of your marriage certificate.

When you have these documents and you know which insurance company you must deal with, you can file a claim. This is quite a simple process. Obtain "proof of death" forms (one for each adult beneficiary) from the insurance agent, then complete these and submit them to the insurance company along with the death certificate. The agent can help with filling in the forms if necessary. Adult beneficiaries will also have to fill out other forms relating to IRS income-declaring requirements.

Once these forms are completed and submitted, the processing stage will get underway. This typically happens very quickly-claims are usually processed and paid out within five business days. During this time the insurance company reviews the claim and confirms that all the requirements of the claim are met. Any delay in this process is usually due to a lack of paperwork (for example if the death certificate is an un-certified copy).

At the time you file the claim, you'll also find out whether or not the deceased had a designated payment plan. Some plans will allow you to choose a payment plan, too. While life insurance claims are typically paid as a lump sum, payments can also be made over time according to a set schedule. This option is typically reserved for children who are too young to manage possessing a large amount of money. Note that lump sum payments are preferred by most adult beneficiaries because this money is not taxable income.

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