Few things in life make more sense than getting a life insurance. This will help us make sure that we are taking care of our loved ones for when our time comes. Whether it is to cover funeral expenses, pay off debts, or even a last act of kindness to a friend or relative, life insurance is nothing but a smart decision.
However, going over the process of claiming a life insurance policy isn’t the jolliest experience. Besides having to deal with the loss of a loved one, there is a process that we must follow. It might not be a complex or thorough process by itself, but given the circumstances, it might feel daunting at first. There are three aspects to keep in mind when claiming a life insurance policy. We need to get all the documents we’ll need and choose how we will receive the payment. We should also remember that it is possible to claim lost insurance if needed.
Gathering the Right Documents
The very first step in the process is contacting the insurance company. All we need to know is the company’s name. When we contact them, having the insurance policy number can come in handy. However, it’s ok if we don’t have the policy number as they should be able to find the information.
Once we have the insurance company aware of the situation, we must file their paperwork. They will need a copy of the death certificate of our loved one, so having it with us is necessary. Once we’re done with this step, we send the claim form and death certificate back to the insurance company.
Choosing a Payment Option
We will have different options to receive the benefit payment. We can decide whether we want to receive a lump sum or installments over a period of time. Depending on our needs, and the amount, you may choose one over the other.
When we receive a lump sum, we get the entire life insurance benefit at once. Some companies might offer to place it on a draft account. This means you would have total access to the benefit, and just like with checking accounts, be able to withdraw whenever you need, in any amount. This can come in handy if we think handling a large sum of money wouldn’t be a problem, or if we have large expenses to cover.
If we decide for periodical installments, we will have different options to choose from. Some companies offer paying interests that the benefit generates, leaving the benefit money intact. Other ways to receive it is by fixed periods or fixed amounts. This is quite helpful if we want to make sure we receive a steady form of income. We can also go for a life installment plan, ensuring income for the rest of our life.
Finding Lost Life Insurance
We must remember that, even when it might be a process some of us might want to postpone, we should file the claim as soon as possible. We should also make our family and friends aware of which insurance company to contact if we choose any as a beneficiary. Even where there have been several state attempts to reinforce insurers obligation to notify beneficiaries, some of them still don’t.
This results in billions of dollars that are being kept by life insurance companies, and that belongs to their clients’ loved ones. If a family member passed recently, and no insurance benefit was claimed, we recommend consulting the National Association of Unclaimed Property Administration’s website to search any lost or unclaimed property, including life insurance benefits.