Some people have financial planning down to an art form, they know how to save money, where to invest, and prepare for worst case scenarios by making sure they have adequate life insurance to protect their loved ones.
However, even the best planners can miss one key step in the planning process: telling their family about any life insurance policies they have in place. It’s easy to understand why this happens, for one, it’s insurance, which isn’t exactly a fun conversation topic. Two, it’s not easy for people to discuss their mortality with their loved ones.
So, what happens if one of your family members passes away without leaving clear information about their life insurance coverage?
How to Find Out if Someone Had Life Insurance - Don’t Rely on The Insurer to Notify You
Insurance companies issue thousands of policies every year, meaning that they have a huge number of policies to manage making it nearly impossible for them to actively check whether each policyholder is still alive. What does this mean for a policy’s beneficiaries? The insurer won’t automatically pay out the death benefit as they may not be aware of policyholder’s passing. The beneficiary needs to inform the life insurance company that the policyholder has died in a timely manner to offset the economic burden. Once the insurer does become aware that they need to pay out on a policy they will actively search for a beneficiary in order to make the payment.
How to Find Out if Someone Had Life Insurance – Follow These Simple Steps
If a loved one passes away without leaving clear information about their life insurance coverage try to remain calm, this is a stressful time. There is always a paper trail for life insurance, whether it’s policy paperwork from the insurer, premium payments on a bank statement, or a wide variety of other documentation.
If you’re wondering how to find out if a deceased parent had life insurance (or any other family member) start your search by using the following tips:
1. Talk to family and friends
There’s a chance that if your loved one had life insurance or thought about getting life insurance they would have discussed insurance options with friends or family at some point in the past. Ask family and close friends whether the deceased ever mentioned life insurance plans.
2. Check bank statements
Whether monthly, quarterly, or annually, life insurance premiums are paid on a regular basis, so check through the deceased bank statements for at least the last year to see if any payments were made to life insurance companies.
3. Look at potential storage locations inside and outside of their house
Look through all documentation stored in the house, check all boxes, look in any drawers, and don’t forget the wardrobes. Did the deceased have safety deposit boxes or any other place they stored belongings? If so, you should check all possible places for life insurance documentation.
4. Check their mail
Life insurance companies will often send out updates about policies, check through all mail in the property and make sure that you open all mail that’s received after their death, even if it looks like junk! A piece of mail from a life insurance provider could indicate that the deceased had a policy with them, even if the mail received is advertising another product!
5. Look with other insurance documentation
It’s not uncommon for people to work with the same agent or insurer to secure all types of insurance such as life, home, and car policies. Check with their other insurance documentation to see if there is any mention of a life insurance plan, it can also be worth calling these insurers to ask about any coverage the deceased purchased through them.
6. Contact their lawyer
Ask the lawyer who’s managing their estate whether the deceased held any additional documentation with them. It’s very possible that they could be holding on to important documents for their client or that the client mentioned life insurance policies during their estate planning discussions.
7. Talk to their employer
Many people have life insurance included with their work benefits. Speak to the deceased’s previous employer to check whether the deceased had access to employer sponsored plans or enrolled in any coverage through the business.
8. Look at the deceased’s tax returns from the last few years
Some insurance policies provide the policyholder with income during their lifetime that is considered taxable, if this is the case you’ll be able to find record of the policy in their tax returns.
9. Contact your state or use online resources
Talk to your state’s insurance department to ask about possible insurance policies, they may be able to help you identify any past or current insurance plans held by the deceased. If it’s been a while since the policyholder passed you can also use online resources such as the National Association of Unclaimed Property Website, which let’s you search for policies in individual states using the name of the deceased.
Claiming a Life Insurance Policy
If you do find evidence of a life insurance policy make sure that you contact the insurance company as soon as possible to notify them of the policyholder’s death. Once the insurer is made aware of the passing they are legally required to search for the beneficiary and begin the payout process.