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One of the most traumatic aspects of losing a relative or close friend is wealth management. Probing will is usually the first step. So it is necessary to find out whether or not there was a life insurance policy. And where is it and who are the beneficiaries?
If you've encountered it in the past, or if you fear it in the future, don't feel alone. It is also a nuisance for lawyers and accountants who claim property after death. "The deceased often leave a confusing trail of financial information behind them, creating unexpected demands and distractions," says the CPA Journal.
The best way to avoid this dilemma: have a discussion with loved ones and friends about their finances and life insurance before ever. However, unless you are very close to an elderly or sick person, it is difficult to raise the question of whether or not a policy exists and who benefits from it.
End of life dementia or disability could have prevented the owner from keeping track. The contractor may not remember having purchased it, whether it has expired due to unpaid premiums, or that it has already been cashed. If it were a life insurance policy, it is likely that it has not been renewed.
After death, there will be further problems encountered while trying to cope with your grief for loss, such as fighting to resolve the flotsam of what the deceased has left behind – often found in stacks or boxes, or even hidden away.
A good detective is suspicious
The best way to treat an unknown or lost life insurance policy would be to treat it as a detective story. A good investigator starts with the suspect. In this case you suspect there was a policy because Uncle Joe said he had one. Or maybe he said he talked to an insurance agent or financial planner who recommended buying one.
Is it worth looking for? Probably. Life insurance companies point out that most of the death benefits are paid, in large part, because the heirs and beneficiaries know they exist and know which insurer to notify.
"In 2018, the last year for which data is available, life insurers paid $ 80 billion to life policy holders," says American Council of Life Insurance spokesman Whit Cornman, who represents the sector.
However, a survey conducted by state insurance regulators found that around $ 7.5 billion has not been collected in past years. This figure may have decreased since 2016 when a complaint about lost life insurance policies aired on 60 minutes of CBS.
But a 2019 National Association of Insurance Commissioners (NAIC) report says that unpaid allowance amounts of over $ 650 million have been "found" by beneficiary searches using NAIC's policy localization tool, since November 2016 at the end of July 2019.
To play hide and seek
Start near home and look for personal documents. These include files, safes, even rubrics that could contain the names of insurance agents, brokers and financial advisors who could have kept their records. Bank and credit card statements may show premium payments to an insurer. As a real estate developer, you can request up to five years of registrations.
And don't ignore the deceased's IRS tax returns. A 1040 tax form and additional filings could show evidence of insurance policies that have paid dividends in the past.
Now expand your search. Where had the insured worked and an employer offered a simple life or a whole life option that the deceased chose? Was the relative or friend who died a member of a fraternal or professional association or union that gave him a policy?
So deal directly with life insurance companies. From a survey of state regulators, which started in 2011 and ended in 2019, with insurers paying fines and a promising return, most major insurance companies now have policy trackers to help potential beneficiaries determine if they are. able to collect. These include companies like John Hancock, MetLife and New York Life. Prudential searched his files to find beneficiaries who didn't even know there was a policy.
The government's "Master of Death" file
Insurers often use the Social Security Administration's "Death Master" file, which records all deceased recipients. Insurers compare their records with those, Cornman said.
If contacted, state governments will now do their best to provide assistance. The New York Department of Financial Services has a "lost policy finder". Allows the executor or administrator of a property, or even a member of the deceased's family or closest relative, to create a search request, provided they provide basic information and a copy of the certificate of death.
States that have online policy seekers include Alabama, Louisiana, Missouri, Ohio, Oregon, Texas and Vermont. And other state insurance departments now offer free search services.
Your state controller's unclaimed property office may be helpful. If an insurer knows that the insured is deceased but has not been able to find the beneficiary, he must transfer the death state to the state. To find your state controller, use the National Association of Unclaimed Property Administrators.
Since there is no national database for all life insurance policies, Cornman recommends using NAIC's life insurance policy location service. But those who need assistance must have basic information about the deceased and be a possible beneficiary.
If all else fails, pay for help
If all else fails and the suspicions persist, take expert help. Several search services are available online, but usually pay for their services.
And there is a national database for all individual life insurance policy claims submitted to US and Canadian insurers. If Uncle Joe had applied for a policy since 1996, the MIB group would likely have a register of the insurance company to which he had applied.
FindYourPolicy.com will have information if Uncle Joe registers his policy with this service.
You'll have to decide if it's worth it. Suspicions are one thing, it turns out another. Many of the old and lost burial insurance policies were considered small, worth a few thousand dollars. But politics could have matured interests. And remember that finding the policy is not a guarantee of collection, since you could be one of the numerous beneficiaries, or not even one.
The best takeaway could be this: a search for someone else's life insurance is a reminder to get your business in order. Make sure to tell your family if you have a life insurance policy and where to find it. Save them the search.
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