Did you know that there is a 1-in-600 chance that you are the beneficiary of life insurance and you don’t even know it? It’s hard to imagine in this day and age of easy and instant access to information that there are countless life insurance policies out there just waiting to be claimed by unknowing beneficiaries, but it’s true. In fact, according to an investigation by Consumer Reports, there is somewhere in the neighborhood of $1 billion dollars in unclaimed life insurance payouts currently sitting in insurance limbo.
Why Does This Happen?
The reasons why so much insurance money goes unclaimed are usually quite simple. Often beneficiaries are simply unaware that their deceased relative even had a policy in the first place. Sometimes this is because the policy holder themselves forgot about the policy, or forgot to mention it to their potential beneficiaries. Other times it just gets lost in the shuffle. People tend to accrue massive amounts of paperwork over the span of their lives, and sorting through it all can be a huge undertaking for those they leave behind, so it’s not uncommon to miss a few details (even important details) here and there.
How Do I Find Out If There is Unclaimed Money Waiting for Me?
It will require a bit of legwork on your part, but if you suspect that you might be eligible for a life insurance payout that you never received, you should start by taking these steps:
- Dig Through the Paperwork
Go through any paperwork that the deceased left behind. Search desk drawers, file cabinets and mail to try and locate any policy documents, names of insurance companies or insurance agents. Premium notices are generally sent annually, so you might still find one in the deceased’s mail up to a year after they’ve passed away. - Check Financial Documents
Check bank statements and cancelled checks that list premium payments. You should also look through tax returns to check for any interest income the deceased might have been receiving from a life insurance company. If you are an executor of the estate, you should also have access to personal files and safe deposit boxes where insurance documents might be found. - Contact the State
If you still have trouble finding definitive answers, check with the state. Since insurance is regulated by the state, your state insurance department might have some information on the policy in question. - Contact the MIB Group (Medical Information Bureau)
The MIB Group is a consumer reporting agency which keeps records of information collected from health and life insurance companies. You’ll have to pay a fee for their services, but if you can’t find any information elsewhere, they might be able to help you track that policy down. - Contact the Insurance Company
Once you do find some life-insurance documentation, even if you’re not 100 percent sure it’s the policy you’re looking for, contact the insurance company in question. If your claim is legitimate, they will walk you through the process.
Let it be A Lesson to Us All
A good life insurance policy can be a critical safety net for those we leave behind, but only if they know about it. Keep careful records of your insurance policy, and make sure you let your family know about it before it’s too late. It will save your loved ones a lot of extra hassle after you’re gone. If you’re currently shopping for a life insurance policy, check out our free online quote tool.