How to Obtain Your Life Insurance Benefits? Most FAQ’s Answered

Collecting your life insurance benefits

One of the most heartbreaking events that can happen to anyone is to lose a loved one. However, if you are going through this hardship, it is good to know that there are simple ways to immediately get your hands on the life insurance benefits of your deceased loved one. For first time beneficiaries, you may have a lot of questions in mind. Read on and have your questions answered.

The following are the most commonly asked questions concerning how to collect life insurance benefits that can help you get through this trying time. 

How would I contact the insurer?

The very first thing that you need to know is how you can contact your life insurance provider.

  • The easiest way is to contact your insurance agent.
  • If in case you cannot contact your agent, you can search online to look for the company customer service hotline.
  • You can find a direct contact number from your policy or within the provider’s website.

How can I get a death certificate?

The funeral service usually prepared the death certificate, but the documents and process that you need to prepare to depend on where you are located. You can easily check it online. Processing the death certificate is the most tedious process because it takes 10 to 12 days or even up to 6 weeks. 

What documents do I need for the benefits?

Right before you try to contact the insurer, it is better to prepare the following documents to avoid delay. 

  1. One of the most important things that you need to do is to secure a death certificate to prove the death of the insured. This is a safety net for insurers to stay away from insurance fraud. One should secure more than one copy of the document for future reference.
  2. It is important to find out the social security number of your deceased relative.

  3. Get the policy number of the deceased person for easy processing.
  4. People who want to get the benefits should prove that they are an authorized beneficiary through: 
  • Preparation of documents that will prove your beneficiary status.
  • Social security number
  • Prepare your income tax return.

How can I get the life insurance benefits money?

Another common question of claimants is how to get the benefits. There are many ways on how your insurer can give you the money and the following are possible methods

  • The payout can be acquired through lump sum which is a method of onetime payment. This is the most convenient way to get your needed money especially if you need it to cover expenses for the funeral. The quickest timeframe to get it is after 2 weeks.
  • You can choose specific income provisions to get the principal and the interest rate according to a specified schedule. 
  • Also, you may opt for life income options that can give you a steady income for a lifetime. However, the amount may vary according to the gender of the beneficiary, the amount of the policy, age of the insured, and the time of death.
  • You can consider the interest income option. The beneficiary may choose to only get the interest gained, and then the principal benefit is given to the second beneficiary if the first one passed away. 

You can get the money through your preferred bank account or any electronic fund transfer. The good thing about the benefits is the fact that it is normally non-taxable, only in a few outside circumstances are the life insurance benefits taxable.

How long do I need to wait for the claim?

If the policy is two years or more, then the entire process may take 10 to 14 days. No matter what type of payout you choose, you are sure to receive it in no time. However, if the insured died without surpassing the two years, then you need to wait a little longer from 1 to 2 months. The insurance provider needs enough time to check and investigate for probable insurance fraud. 

It is important to take note that insurance providers are under the state law that requires them to process the claim within a specific time. They must release the benefits within one month after filing. In case they failed to do so, then the beneficiary has the liberty to file for “statutory interest”.

What are the causes of delay or possible denial of the claim?

Although most claims are very easy to get, there are instances when a beneficiary may get denied. The following are possible reasons:

  • Passing away within the period of contestability of two years. 
  • Death is due to homicide. 
  • Death due to suicide.
  • Death due to risky activity stated on the application.
  • Death is linked to any illegal activity like drunk driving. 

All of these situations will trigger the insurer to investigate and find out if there are possible violations. For accidental death, then you need to communicate with the Underwriter. Also, take note that the underwriter is finding all means to deny the claim. They may even trace back the history of the insured to look for possible violations. The investigation may include the insured’s autopsy report. Also, they will ask for toxicology and medical records. 

In case you fall into one of these situations, then you may ask for legal help to avoid losing your benefits. A reference guide that might help: The Centers for Life Insurance Disputes.

What if the main beneficiary passes away?

There are instances when the original beneficiary may pass away, but there are considerations to help you get the benefits. 

  • They will investigate to find out if there are qualified co-beneficiaries. 
  • If the main beneficiary is deceased, then other qualified beneficiaries may file for the benefits.
  • The benefit is subjected to probate status if there is no qualified person to get the claim. This is true especially if there is no specific instruction from the insured. The state court will decide on the policy. 

Other Important Considerations

It is important to take note that most of the complaints regarding life insurance benefits are delays as well as a complication in the process of claims. You need to carefully look for a reputable insurance provider to avoid future hassle and remember to always be specific with your wishes written on your policy, and make all possible beneficiaries aware of the policy. 

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