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How To File A Claim For Life Insurance

Sarah Li Cain3-minute read
UPDATED: September 20, 2022

Having to file a life insurance claim isn’t exactly easy (and of course, it’s quite emotional) as it means that you’ve lost a loved one. But not filing a claim could mean that you might struggle financially, especially if you’ve relied on that person’s income or you need to pay for certain expenses. Besides, if you don’t make a claim, the policyholder’s money is wasted.

While it’s hard to think about all this while going through the grieving process, the somewhat good news is that filing a life insurance claim is fairly straightforward.

How To Claim Life Insurance

Every life insurance company is different, so it’s best to contact them directly. For the most part, the procedure is as follows:

  • Know the name of the company – In many cases, you may not need the policy number or the policy information. However, you do need to know the life insurance company’s name or the agent who sold it to the deceased policyholder.
  • Obtain the death certificate – You’ll need to submit the death certificate when you file a claim.
  • Submit relevant paperwork – Call the insurance company to determine your next steps, such as filling out a claim form. Depending on the nature of death, additional documents might be required.

How Can I Receive The Money?

The two main ways life insurance companies will pay out claims are in either a lump sum or in installments. With a lump sum, the company can open a draft account (similar to a regular bank account) where you can withdraw the cash until the balance reaches zero.

As for installments, the life insurance company will hold your claim money and offer regular payments. It varies from company to company, but you can typically expect interest on the principal amount.

How Do I Claim A Death Benefit?

The Social Security Administration offers what’s called theSocial Security death benefitfor surviving family members. Assuming the deceased family member has enough Social Security work credits, you could receive a lump-sum payment. A surviving spouse or dependent children can claim this benefit by going to their local Social Security office. Staff there can give you guidance and show the types of documents, information and paperwork you’ll need.

The Social Security Administration also has monthly survivor benefits for qualifying family members.

Since rules can vary depending on your relationship to the deceased, it’s best to contact your local Social Security office to see what you need.

Generally speaking, the following family members can qualify for monthly benefits:

Surviving spouses If you’re getting benefits, you’ll receive the higher amount compared to your deceased spouse’s. Those who haven’t gotten benefits or are receiving Social Security based on their own earnings will need to apply. Eligibility depends on your family circumstances and age.

Former spouses– You could be eligible, like surviving spouses, but it depends on whether your marriage lasted a minimum of 10 years and your ex-spouse didn’t remarry by 60 years old. There are exceptions, such as if your deceased ex-spouse took care of a disabled or young child.

Dependent children – Unmarried children up to 17 years old (or 10 if attending high school full time) may be eligible. This also includes grandchildren and stepchildren.

Dependent parents – If the parent depended on the deceased for at least half their expenses or are a minimum of 62 years old, they may be able to qualify.

In most cases, you can start the application process over the phone or online, but you’ll need to show up in person and have a face-to-face meeting with a SSA staff member.

Some benefits aren’t retroactive, so the sooner you apply, the better.

How Long Does A Beneficiary Have To Claim A Life Insurance Policy?

Technically, there’s no time limit when it comes claiming death benefits with life insurance companies. However, these companies do have limits when they need to pay out claims – usually within 30 days of the insured’s death.

That being said, you might want to consider filing a claim as soon as you can. There doesn't seem to be much incentive for life insurance companies to find surviving family members. Even if you don’t know which company sold the life insurance policy, the deceased may have a policy from their former job. Contact the employer; the HR or benefits department might be able to help.

Helping your family during this sad time can hopefully teach you to be more proactive about your finances. This means making sure family members have copies of your life insurance policy in the event of your untimely death. For more articles like this, visit our personal finance Learning Center.

Sarah Li Cain

Sarah Li Cain is a freelance personal finance, credit and real estate writer who works with Fintech startups and Fortune 500 financial services companies to educate consumers through her writing. She’s also a candidate for the Accredited Financial Counselor designation and the host of Beyond The Dollar, where she and her guests have deep and honest conversations on how money affects our well-being.