Why Is a Death Certificate Important for Insurance?


Death certificates are issued when a person dies, and are filed with the government agency that records deaths in your state. The death certificate contains the date, location and cause of death. It can be used in any situation where you need to provide proof of a person's death, such as for insurance, probate or estate purposes. A death certificate can also be used to notify the decedent's creditors about the death.

Insurance Fraud

Fraud costs insurance companies money, which in turn causes them to raise rates. Losses from fraudulent life insurance or death and disability claims are mitigated by the requirement that you provide a certified copy of the death certificate. Uncertified copies are available, but they cannot be used for legal purposes. For some insurance policies, the cause of death is an important factor in determining whether or not to pay the claim.

Specialized Insurance

Death and Dismemberment insurance pays off if you lose fingers, limbs or toes or if you die under certain conditions specified in the policy. To make a claim you must prove that the death resulted from a covered reason. The certified death certificate lists the cause of death. Public carrier insurance pays a death benefit if your death is the result of a public carrier. For example, if you are on a bus and it is involved in an accident that causes your death, your heirs will need the death certificate and proof of the accident to claim the benefit.

Life Insurance

Life insurance companies have more reasons to require a death certificate than other product carriers. A life insurance policy may exclude payment for death from specified causes, in which case a death certificate is needed to certify the cause of death. Life insurance policies can also have exclusionary clauses barring payment for suicide.

Time of Death

Time of death can be significant in the determination of the beneficiary of a life insurance policy. For example, if you and your wife are both insured, are killed in an accident, and are each other's primary beneficiary, the insurance company must determine to whom the benefits go. If you have different contingent beneficiaries, to whom the benefits go is determined by the time line of your deaths. If you died first, your spouse is the beneficiary and would be eligible for the proceeds. If she subsequently dies, her contingent beneficiary could receive both death benefits, because your wife technically outlived you and the proceeds of your policy would be payable to her estate. If her contingent beneficiary is the heir to her estate, that person would receive the proceeds from your policy as well. This is the procedure even if she was only alive for a minute after you died.

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