Life insurance is a contract that exists between the policy holder and insurer for the payment of a certain sum of money to a beneficiary or beneficiaries upon the policy holder’s demise. When the policy holder passes away, there is generally no need for probate or for an administrator of the decedent’s estate to take any action so that the beneficiary can collect the proceeds. There are times, though, when an executor or administrator may be called upon to assist the beneficiary in collecting the funds.
The Claim Process
A beneficiary, or beneficiaries, of a life insurance policy needs to file a claim with the insurance company that issued the policy. The beneficiary should find out what type of policy the holder possessed, such as the following:
- Term life
- Names of all the beneficiaries
- If there was a provision whereby a mortgage or other loans were to be paid off first
- The amount of the policy
If you knew you were a beneficiary, contact the decedent’s executor or family member to get the policy document. If it is lost, call the insurance company and have it send you a copy. You will need a certified copy of the death certificate with the state seal is affixed to be sent in with the form or forms provided by the insurance company. Each beneficiary needs to submit a separate form.
Sometimes an executor or administrator is asked to locate the beneficiary who may be unaware of the decedent’s death. The administrator may have the death certificate containing the state seal and any other information required by the insurer such as Social Security number or even driver’s license number. The beneficiaries will also have to provide their own valid identification.
If the decedent’s policy was substantial and/or the decedent died under mysterious or unusual circumstances, the insurer may wish to conduct its own investigation. Some of the reasons why an insurer will deny your claim include:
- The decedent committed suicide (most policies have such provisions)
- The decedent lied on the policy application
- The decedent engaged in activities specifically prohibited under the policy
- You are suspected of murdering or causing the death of the decedent
Examples of prohibited activities on a policy might include smoking, sky diving, bungee jumping, or taking drugs. Specific activities may be included if the insured is or once engaged in risky activity. If the policy holder died from any of these causes, you may have a difficult time collecting.
If you are questioned, it is recommended that you cooperate fully with the insurer’s investigator, respond truthfully to questions and not try to hide or obfuscate the truth. If you feel the insurance company is unreasonably denying your claim, contact a trusts and estates attorney to advise you regarding your claim and your legal options.
Otherwise, you can probably expect your claim to be paid within two weeks of you submitting the form and all the requested information.
If you would like more information about how to collect life insurance, speak to an experience attorney like Christopher B. Johnson.