Being a beneficiary of a loved one’s life insurance policy (the person they have chosen to receive the money known as a “death benefit”) isn’t something that happens to us every day. So, it’s understandable you might be confused about life insurance beneficiary rules, and about how the process works. Let’s say you’re not sure you’re a life insurance beneficiary. Will someone tell you? Or do you have to do something to find out?
In most cases, beneficiaries know they’re beneficiaries because the policyholder tells them ahead of time. This is the ideal situation—a loved one who’s still alive lets you know you have been named their life insurance beneficiary and where to find the policy if they die while the policy is in force. If the loved one passes away, you know how to locate the policy and contact the insurance company to make a claim.
But, sometimes, policyholders forget to tell their beneficiaries about the policy or the details—where they keep the paperwork, how much the policy is worth, and the name and contact information for the insurance company. You may have an idea that there’s a life insurance policy and that you were meant to be a beneficiary, but you don’t know for sure. Now, what?
Many life insurance companies try to contact beneficiaries if the beneficiaries don’t contact them first. The “catch” is that there’s no automatic process that tells them about policyholder deaths. Usually, the way the insurance company finds out the policyholder has died, and that the policy needs to be paid, is from the beneficiaries or other family members. Many states require insurance companies to check the Social Security “Master Death File” for deceased policy holders and to try to notify their beneficiaries when they find a policyholder on that list. But that can take time. And it’s not the rule in every state.
So, don’t count on the company finding you. If you think your loved one might have had a life insurance policy, and you might be a beneficiary, there are things you can do to find out.
One suggestion is to ask other members of the family, if possible. Someone might know something you don’t. Assuming you have the authority to look through your loved one’s personal papers (or can get permission), look for the insurance policy itself. If you don’t find the policy, look for life insurance receipts or evidence of payments in a checkbook register. Remember to check digital storage—computers and mobile phones—as well. If you think your loved one may have been covered at work, contact that person’s former employer or labor union. If any of these searches turn up the name of the insurance company, that can sometimes be enough to start the claim process. (Having a company name and a policy number is even better.)
Let’s say you try those steps and come up empty. Don’t give up—there are still ways to track down a life insurance policy. You might want to contact the National Association of Insurance Commissioners (NAIC) for their free Life Insurance Policy Locator Service, which looks for policies on the databases of many insurance companies. Another great resource could be your state’s Department of Insurance (DOI). Some states have DOI websites where you can put in information about the deceased and find out if they had insurance policies.
One last thought. If you have a life insurance policy of your own, make sure your loved ones know about it. That will help make it easier for them to get the money you want them to have.
FAQs
The easiest way to learn if you are a life insurance beneficiary is to talk to the policyholder if they are still alive. They can tell you whether you're a beneficiary and provide information necessary to claim the death benefit when they pass away.
How do I find out if I am a beneficiary for life insurance? ›
The best way is to contact the policy's issuer (the life insurance company). Their records are key: even if you see your name listed on an old policy document, the deceased may have changed their beneficiaries (or the allocation of benefits among those beneficiaries) after that document was printed.
How do I know if I am a beneficiary? ›
Following your conversation with the policyholder, review documents like wills, trusts, and insurance policy paperwork to confirm your beneficiary status. Look for the beneficiary designation form in the policy documents, which lists the names of the beneficiaries.
Will I be notified if I am a beneficiary of life insurance? ›
Once a policyholder has passed away, beneficiaries typically receive life insurance notification within 90 days of the death.
Is there a database to see if someone has life insurance? ›
If you suspect that a loved one had a life policy, the National Association of Insurance Commissioners (NAIC) has created a Life Insurance Policy Locator service to help consumers locate benefits from life insurance policies or annuity contracts purchased anywhere in the United States.
How do I know if my deceased loved one had life insurance? ›
The National Association of Insurance Commissioners (NAIC) offers a free Life Policy Locator tool to help you find out if someone had life insurance. To use the tool, you'll need to provide the following information for the deceased: Social Security Number (SSN) Legal first and last name.
What happens if a beneficiary does not claim life insurance? ›
The beneficiaries will never receive payment if they do not claim the life insurance benefits. The money can remain with the life insurance company for a certain period, but as you will see below, the life insurance company does not keep the money forever.
How to trace a beneficiary? ›
Steps to locate a missing beneficiary
Statutory advertisements–Regardless of whether there is a missing beneficiary or not, we would recommend that the PRs place 'statutory advertisements'. These are placed in the Law Gazette and a newspaper local to where the deceased lived.
Do you need a Social Security number for a life insurance beneficiary? ›
Most beneficiary designations will require you to provide a person's full legal name and their relationship to you (spouse, child, mother, etc.). Some beneficiary designations also include information like mailing address, email, phone number, date of birth and Social Security number.
What can override a beneficiary? ›
An executor can override a beneficiary as long as doing so is necessary to follow the terms outlined in the will or a court order. However, an executor cannot override a beneficiary to change or withhold their inheritance or modify the terms of the last will and testament just because they want to.
In many cases, it takes anywhere from 14 to 60 days for beneficiaries to receive a life insurance payout. But many factors impact this time frame. These include the insurance company's procedures, when the claim is filed, how long the policy was active, the cause of death, and state laws regarding insurance payouts.
How do you claim a beneficiary on life insurance? ›
To file a claim, the beneficiary will need to notify the insurance company's claims department. The claims department then sends a form for the beneficiary to complete and return along with the policy and a certified copy of the insured's death certificate.
How do I trace a life insurance policy? ›
Tips for finding a lost life insurance policy
- Search the deceased's documents and correspondence. ...
- Submit a request to the NAIC Life Insurance Policy Locator Service. ...
- Contact the state's Unclaimed Property Office. ...
- Be aware of special challenges. ...
- Keep in mind fee-based services are available if needed.
However, if the beneficiary dies, who gets the money? In that case, the payout will be split among any contingent beneficiaries named when the policy was purchased. If there are no contingent beneficiaries, then the death benefit will most likely be paid directly into your estate.
