FAQs on Collecting on Life Insurance Policies
Life insurance policies can be collected on after the insured individual dies. Life insurance companies generally require that you furnish them with certain information and file your claim as soon as you can after the death of the insured.
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Identification
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Make sure you have both a copy of the death certificate and the claim form from the insurance company. The death certificate proves that the insured individual is dead and the claim form is necessary to terminate the insurance policy and pay the death claim.
Time Frame
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Claiming the death benefit with the week or month after the individual dies ensures that you are able to pay any final expenses of the insured individual. If you do not file a claim and the insurance company sends another bill to the insured, it may not be paid and the insurance company may cancel the policy. Or, if the insurance company knows that the insured individual has died, the company may send the death benefit to the state's unclaimed property division if it remains unclaimed.
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Features
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Some life insurance policies have stipulations built into the contract that allow the policy holder or insured to dictate how the death benefit proceeds will be paid out. Make sure you understand the features of the policy before the insured individual dies. For example, if you are expecting a lump sum distribution, but the insured individual wants the money paid out in installments, it may be helpful to know this in advance.
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