Unclaimed Life Insurance Benefits Act
Beneficiaries unclaimed life insurance policies: While most people inform their family and the beneficiaries of the life insurance policies they have taken, some are very unfortunate keeping everything in the closet. There are many circumstances when the beneficiaries do not claim the policy benefits. Following are some necessary measures to avoid unclaimed life insurance benefits and loss of money.
1. Loss of Communication between the Policyholder and the Insurance Company
When you take a policy from an insurance company, it is always necessary to provide the details about the mailing address, contact number, fax number, email id and any other possible mode of communication. Sometimes, the policyholder fails to inform the insurance company about the change of residential and office address amid the hassles of relocation problems.
If you or the policy beneficiaries are relocating to another destination, it is important to notify the insurance company about the new address and changed contact information so that they can update the existing records.
2. Beneficiaries do not Inform the Insurance Company about the Policyholder’s Death
The insurance company may not know that the insured policyholder has died. It is up to the family members of the policyholder or the beneficiaries to inform the concerned authorities. This will help them to file the claim process in a proper format. Many times, the beneficiaries fail to inform the concerned authorities resulting in the insurance policy to lapse due to the non-payment of the premiums at the regular basis.
The family members of the policyholders must recognize the fact that stopping the regular premiums does not mean that the person is dead. The insurance company will send a notice about the due payments and other notification in due course. Some people take single premium policies or few premium policies that take less time to pay off fully. If the person is still living and does not claim the benefits, there is no reason left with the insurance company to send a notice.
It is in the best interest, the policyholders should give the contact information of the insurance company and policy details to their beneficiaries so that they can inform the concerned authorities at the right time.
3. Difficulty to Find the Original Policy
Sometimes, locating the original insurance policy can become difficult due to the following reasons:
- The issuer insurance company has changed its name
- Merger or changing terms of the current policy
- The policyholder or the insurance company business has relocated to some other state
If you take an insurance policy, always keep track of the movement of the company if they have changed their name, address etc. If they have moved the office location to some other state, contact the authorities immediately to inquire about the modification in rules depending on the state’s insurance laws.
Beneficiaries are Unaware of the Insurance Policy
In the attempt to eliminate any possible manipulation, often the policyholders do not share the information about the insured policy to the beneficiaries. This is a frequent occurrence in case of group policies. A beneficiary of the group insurance may not know about the insured amount. Rather than keeping the things confidential, it is good to share the information with all the beneficiaries so that they are able to get the due coverage upon processing the claim.
The Bottom Line,
Taking a life insurance policy is always a good decision to secure yourself and the entire family. If you have taken a policy and paid the hard-earned money on premiums, your beneficiaries have full right to claim the insured amount in case of a mishap. If you have taken the policy, inform all the beneficiaries about the policy, give them the contact information and preserve the documents very carefully so that they have quick access to move on with the claim process when needed.
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- 1 Unclaimed Life Insurance Benefits Act