Life Insurance Beneficiary – What you need to know

Attention Beneficiaries:

Claiming life insurance benefits takes more effort than you think!

Do you know what type of life insurance policy your loved ones have?

Do you know what company it’s with?

Do you know where to find the original paperwork?

Do you know how a claim can be filed on that policy in the event of a loss?

If you aren’t able to answer yes to all of those questions (and most people aren’t), this is for you. Oftentimes, consumers sign up for life insurance, pay their premium, and assume that their loved ones will receive a check in the mail shortly after they pass away. Unfortunately, that isn’t the case. Most insurance companies have no intention of contacting beneficiaries when the insured person becomes deceased. There’s also the issue of contact information changing and the excuse that the beneficiary can’t be located. This leaves some work for the family to do but it’s not as overwhelming as it may seem.

Chief Financial Officer of the State of Florida Department of Financial Services, Jeff Atwater, is working to implement new processes and procedures to fix this problem. His plan says that soon enough, all insurers will be required to locate beneficiaries and provide their due benefits. If they can’t be found, the unclaimed funds will be turned over to his office (for the state of Florida) to hold on to and continue trying to locate the person it’s intended for.

Words of advice: Communicate with your loved ones about the details of your life insurance policy. It’s a tough conversation to have as no one enjoys talking about death but it’s very important. Paying premiums and leaving the insurance company responsible to actually pay out the benefits to your family is not enough. Make copies of paperwork for their records or inform them of your safe place where the documents are kept. If policy details are lost or the beneficiaries are unsure, there are “life policy locator” services such as the Medical Information Bureau that can assist in locating policy information for a fee.

More questions about life insurance? We can help! Email Nick Deas at nick@mcgriffwilliams.com.

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