Filing a life insurance claim usually happens at a difficult time, but the process itself is straightforward once you know what the insurer needs. Insurers do not pay automatically: they generally learn about a death only when a beneficiary contacts them. This guide explains the steps, the documents and the common reasons for delays.
1. Find the policy and the insurer
Look through the deceased person's papers, bank statements (premium payments), e-mail, tax returns and benefit statements from employers. Group life insurance through an employer is common, so contact the human resources department of the person's current and former employers. Also check with a financial advisor, attorney or insurance agent the person used.
If you cannot find the policy, use the NAIC Life Insurance Policy Locator. It is a free service: you submit a request with the deceased's information, and participating insurers search their records and contact you if you are a beneficiary. In its first year after the November 2016 launch, the locator matched 8,210 beneficiaries with lost or misplaced policies and annuities worth $92.5 million, according to a 2017 release by the Wisconsin Office of the Commissioner of Insurance. Old benefits that were never claimed may also have been turned over to a state unclaimed property office, which you can search for free.
2. Contact the insurer
Call the insurer's claims department or use its online claim portal. Have the policy number (if known), the insured's full name, date of birth, Social Security number and date of death. The insurer will send a claim form (often called a claimant's statement) and a list of required documents.
3. Gather the documents
| Document | Notes |
|---|---|
| Certified death certificate | Order several copies from the funeral home or vital records office; banks and other insurers will also ask for them |
| Claim form | One form per beneficiary, with your identity and tax information |
| Policy document | Helpful but often not required if the insurer can identify the policy |
| Additional records | For accidental death benefits or deaths early in the policy: police report, autopsy or medical records |
| Estate documents | If the estate is the beneficiary or no beneficiary survived: letters testamentary or of administration |
If a beneficiary is a minor, the insurer usually cannot pay the child directly; a court-appointed guardian, a custodian or a trust named in the policy receives the funds.
4. Choose how to receive the money
- Lump sum: the full amount in one payment, the most common choice.
- Retained asset account: the insurer keeps the money in an interest-bearing account and you write drafts against it. Ask how it is protected and what it pays.
- Installments or annuity: payments over a period of years or for life.
According to the IRS, life insurance proceeds paid because of the insured person's death are generally not included in gross income. Interest paid on the proceeds, for example on installments or for a delay, is taxable as interest income. Estate tax questions are separate and depend on the size of the estate.
Why claims are delayed or denied
- Contestability review: if the insured died within the contestable period stated in the policy, the insurer may review the application and medical records for misstatements.
- Exclusions: for example, a suicide exclusion during the early years of the policy, or exclusions in accidental death coverage.
- Lapse: unpaid premiums can end a policy, although policies have a grace period and some include automatic premium loans.
- Beneficiary disputes: competing claims, a divorce, or an outdated designation can lead the insurer to ask a court to decide who is entitled to the money.
- Missing documents or an unclear cause of death.
State laws set standards for prompt claim handling, and the details differ by state; if payment is delayed, ask the insurer whether interest is owed under your state's law. If the claim is denied, ask for the reasons in writing and see our guide on challenging a denied claim. You can also file a complaint with your state insurance department.
Helpful habits for policyholders
- Tell beneficiaries that the policy exists and where the documents are kept.
- Review beneficiary designations after marriage, divorce, births and deaths. The designation on file with the insurer generally controls, not your will.
- Name contingent beneficiaries so the money does not default to your estate.
- Keep the insurer's contact details and the policy number with your important papers.
To compare term and permanent coverage, see our life insurance section or request a quote. Policies are issued by licensed insurers and placed through licensed producers in your state.