When a life insurance policy is lost, you’ll need to know specific info about the policy (such as the company it’s from, and the state it was issued in), and you usually must be an immediate family member, a beneficiary, or the executor to access the info.
Even though you know a lost policy exists, actually locating it can be extremely taxing.
The big reason for this is that no life insurance policy database currently exists. Though efforts are being made by the National Association of Insurance Commissioners, the locator tool is still far from perfect.
Even then, the process is slow, taking upwards of 3 months, so you’re probably much better off doing the legwork yourself.
Here are the tools you need to quickly and efficiently find lost life insurance policies.
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First things first: what exactly is a life insurance policy and what are you even looking for?
Typically, it’s a lengthy, bound contract which the insurance company usually puts in a folder or booklet of some kind.
The name of the insurance company, the name of the insured, and a policy number are almost always put on the front for easy discovery.
If you know the insurance company, look for a document which is bound in the company colors. If the brand color is blue, for example, look for a blue-bound policy.
Of course, today, some policies are delivered electronically, so you might not be able to find a hard copy.
While we do recommend always getting a paper copy, if you choose not to, make sure the policy is listed in your will.
The absolute best thing you can do to prevent problems from arising is avoid lost life insurance policies in the first place.
If you know a close family member has a life insurance policy, make sure to bring up the topic, even if it’s uncomfortable.
There’s no denying the topic is difficult to broach since it involves death and money, two topics notoriously difficult to talk about.
But doing so is essential to avoiding confusion in the future.
The same goes for you if you’re taking out a life insurance policy yourself.
Though you don’t need to get into the specifics of the policy, make sure to talk about it with your beneficiaries, so finding the policy is simple after your death.
The key here is to provide your beneficiaries with:
- The name of your life insurance company
- The name of your life insurance agent
- The state you bought the policy in
- And, most importantly, the policy number
It’s still a smart idea to include a copy of the policy (and update it with a current copy as needed) in your will or other estate plan paperwork.
Finally, you should make sure your life insurance company and agent have up-to-date contact information for all of the beneficiaries listed in your policy.
Follow these steps closely and you’ll likely avoid lost life insurance policies in the first place.
If you do know a deceased loved one had a life insurance policy, but you don’t know any information about it, there’s still no reason to panic.
There are a number of strategies you can use to track down these lost policies to ensure the listed beneficiaries get the full benefits.
Here are 10 of the most effective strategies:
- Documents: Look through the files and other storage spaces of the policyholder for relevant life insurance documents.
- Bank Statements: Look through old bank statements to see if payments were made to any life insurance companies.
- Mail: Look through old mail for information related to the policy, and keep an eye on new mail for at least a year after the death for annual notices or policy updates from the life insurance provider.
- Financial Professionals: Reach out to accountants, financial advisors, and bankers the deceased dealt with to find policy information.
- Previous Employers: Reach out to past employers of the deceased for information regarding group life insurance policies.
- Banks: Check to see if the deceased has a safety deposit box at their bank. It might have the policy inside.
- Income Tax Returns: Life insurance companies pay interest on permanent whole life policies. These earnings may show up on the income tax returns of the deceased.
- Unclaimed Property Office: Life insurance companies are legally required to turn the death benefit over to the state if they can’t find the beneficiaries. Check with the Unclaimed Property Office of the state the policy was purchased in.
- State Departments: 29 states currently offer free tools that enable you to look for lost policies bought in those states. Use the National Association of Insurance Commissioner’s Life Insurance Company Locator System.
- MIB Database: Though there is no national database of purchased life insurance policies, there is a national database of life insurance applications. Check the MIB Consumer Protection site for leads.*
*According to the MIB itself, the service costs $75 and results in matches only around 25% of the time.
A final option you have to find lost life insurance policies is to hire a private search service or organization.
Such a service will conduct a thorough search into the lost policy, which will typically cost several hundred dollars.
Although this is undoubtedly the most expensive strategy, it’s usually effective.
Once you track down the needed information related to the lost policy, it’s time to make the claim.
The first document you need is the death certificate of the policyholder.
You can obtain this from the county recorder, and you must ensure the copy you send with your claim is certified.
You must also complete a claim form to officially make your claim. The life insurance company will provide you with this form.
Making a claim consists of only these two steps if you have a copy of the policy you can send in with your claim.
If you don’t have a copy of this policy document, you can still effectively make a claim, but it will take longer and require more paperwork.
You’ll be required to fill out (rather extensive) paperwork and wait until all of the provided information is verified.
Many life insurance companies also require a background check and an identity check.
Basically, making a claim on a lost life insurance policy is a waiting game.
The good news is, the waiting period for receiving benefits is actually decreasing, and a lot of the legwork can be done electronically these days.