How Long After Filing Does Life Insurance Pay Out?
Many people who buy life insurance do so with the intent of covering final costs and providing an inheritance to heirs and other named beneficiaries. However, life insurance companies don't automatically pay once a person dies. A beneficiary must submit a claim first. How long it takes to get your insurance money after you do this depends on several factors.
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Documentation
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To process your life insurance claim, the insurance company has to have a properly-completed claims form. It also needs documentation regarding the deceased, the beneficiaries and the policy terms. At a minimum, this means having a copy of the death certificate and the life insurance policy. Insurance companies may need paperwork like police reports or witness statements, as well, depending on the circumstances surrounding the claim. The more documentation is necessary for your claim, the longer it will take for the insurance company to verify all the associated facts and get your check to you.
Period of Contestability
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Most insurance companies have a period of contestability associated with their policies. The period of contestability is a designated amount of time after you buy a life insurance policy during which the insurance company has the right to investigate claims more thoroughly. The idea behind a period of contestability is that it deters individuals from buying policies and immediately submitting claims under fraudulent or otherwise suspicious circumstances. It can take several months for an insurance company to complete a thorough investigation during the contestability period.
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Timely Payment Laws
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Most states have timely payment laws. These laws require that insurance companies respond to claims within a reasonable time frame. Typically, this is anywhere between 15 and 45 days, depending on the state. Timely payment laws don't mean that you'll get paid within the designated time frame, but they provide a platform upon which you can verify the company received the claim and what the status of the claim is. This means that, in the worst-case scenario, no more than a month-and-a-half will pass before you know what next steps you need to take.
Bottom Line
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If everything goes smoothly, you may receive a life insurance check in as little as two weeks, as the Insurance Providers website asserts. This would happen with a simple, uncomplicated claim submitted to an efficient insurance company. However, depending on whether you file during the contestability period, how much documentation there is and how accurate the data the company has, getting a life insurance payment might take several months. In the instance you need to take the life insurance company to court, the time between filing and payment could extend into years, depending on legal action taken by both you and the insurance company.
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References
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