What Happens When a Life Insurance Policy Is Unclaimed or Unpaid?
Life insurance policies are commonplace in the United States. As someone ages, has children, or simply wants to make a responsible financial decision, they begin to consider the impact that the passing of a family member will have on the rest of their family. By taking out a life insurance policy, the policyholder can name beneficiaries to receive payments and assets after they (or a loved one) pass.
Some of these result in lost policies where life insurance companies are able to keep the money of the policy even after death. Exploring the complex details of life insurance policies while consulting San Diego life insurance bad faith attorneys may help better your chances for evading a situation in which you lose thousands of dollars that your family is entitled to.
How Life Insurance Policies Are Left without Payout
As is the natural way of life, people consider their death. Although it may not happen for several decades, many individuals still decide to take out life insurance policies. They may forget about them, forget to mention their policies to their beneficiaries, or even believe it to be best not to mention them due to family tensions or other personal problems. These may lead to failures to payout policies.
Yet even though term life insurance policies may expire, they may get paid up, or have collected enough cash value to cover premiums for the remainder of the policyholder’s life. Just like when a whole life insurance policy lapses, the policies may still be in force and do not go away. It is important to have these discussions with family members while reading the fine print of life insurance policies to ensure money paid over the course of years is not lost.
Responsibility of Notification
The single most critical aspect of a life insurance policy is the beneficiaries’ notification to the insurance agency that the insured has passed away. This will allow the beneficiaries to claim the payout. Naturally, many life insurance companies have made little to no effort to investigate the death of an individual, leading to unpaid benefits. Government and legal firm investigations into this have led to hundreds of millions of dollars being paid out to the deceased’s’ families. There are some ways to ensure you get your payouts fast, however.
- Contact the life insurance company at your earliest convenience to inform them and collect information regarding the proper documentation to collect.
- Have the death certificate of the policyholder ready to go before all else.
- Make sure all the requirements are in line.
- Contact a life insurance lawyer if any problems arise with payouts.
The beneficiaries do not have to file a claim within a certain timeframe. In some cases, the death benefit will grow with interest until the claim is filed or the life insurance company finds the beneficiaries. It is important to remember that the large majority of payouts are delivered within 30 days of notification, and should never take longer than 60.
Reach Out to a Life Insurance Attorney Today
Dealing with the death of a family member is hard. Sometimes, dealing with the unwillingness of life insurance companies can complicate matters even more. Reach out to a San Diego life insurance attorney at Dawson & Rosenthal, P.C. at (619) 354-1652 or by clicking here to receive prompt, well-informed legal help for all of your life insurance payout needs.