How to File a Life Insurance Claim: A Step-by-Step Guide

Filing a life insurance claim usually happens during one of the hardest times in a person's life. The process is more straightforward than many people expect, and knowing the steps in advance can make it easier. This guide is written for beneficiaries, but policyholders can use it to prepare their families.

Step 1: Locate the policy

Sometimes the policy documents are easy to find. If not, look through:

• Files, safes and desk drawers at home.
• Bank statements showing premium payments.
• Emails and mail from insurance companies.
• The deceased's employer, which may have provided group coverage. See group life insurance through work.
• Their agent, financial advisor or attorney.

If you still cannot find anything, the National Association of Insurance Commissioners (NAIC) offers a free Life Insurance Policy Locator. You submit the deceased person's details, participating insurers search their records, and if one finds a policy that names you as beneficiary, it contacts you directly, usually within about 90 days. The NAIC itself holds no policy information. State unclaimed property offices can also help find money owed to you.

Step 2: Gather documents

• The policy number and insurer's name, if you have them.
• A certified copy of the death certificate. Order several copies, because many institutions require an original.
• Your own identification and Social Security number, since the insurer needs it for tax reporting.

Step 3: Contact the insurer

Call the insurer's claims department or use its online process. They will tell you which forms to complete, usually a claimant's statement. Many insurers let you start the process online or by phone.

Step 4: Submit the claim

Complete the forms carefully and include the death certificate. Keep copies of everything you send, and note the date and name of anyone you speak with. If the death occurred within the first two years of the policy, expect the insurer to review the claim more closely. See why claims get denied.

Step 5: Choose a payout option

Insurers typically offer several options:

• Lump sum: the full amount at once. This is the most common choice.
• Installments: regular payments over time, sometimes with interest.
• Retained asset account: the insurer holds the funds in an account you can draw on.

Review the terms before choosing, and ask whether interest is paid and how it is taxed. See is life insurance taxable?

How long does it take?

Straightforward claims are often paid within a few weeks after the insurer receives all required documents. Claims that need extra review, such as those within the contestability period or involving unclear circumstances, can take longer. If payment is delayed, many states require insurers to pay interest on the benefit.

If there are multiple beneficiaries

Each beneficiary typically files their own claim form, and the insurer pays each their share according to the designation on file. If there is a dispute about who should receive the money, the insurer may hold the funds until it is resolved. See how to choose a beneficiary.

After you receive the payout

• Do not rush big decisions. Park the money somewhere safe, such as an insured savings account, while you grieve and make a plan.
• Cover immediate needs first, such as funeral costs, urgent bills and living expenses.
• Be careful with unsolicited offers. Newly paid beneficiaries are sometimes targeted by salespeople and scammers.
• Consider professional advice from a fee-only financial planner before investing or paying off large debts.

Prepare your own family

If you are a policyholder, tell your beneficiaries that the policy exists and where to find it. Keep a simple list of your policies, insurers and contacts. It can save your family weeks of searching at a difficult time.