Discovering Hidden Life Insurance Policies: Steps to Uncover Unclaimed Benefits

Discovering Hidden Life Insurance Policies: Steps to Uncover Unclaimed Benefits

You might be surprised to learn that billions of dollars in life insurance policies go unclaimed. And by the way, if you don’t have a life insurance policy yet, get one today (or at least find out how much it costs, that’s free) because it will be your loved ones who would benefit from it in the end. As you read on you’ll find out insurance companies can’t keep your money so they really do not gain from your death, your policy will only end up benefiting either your family or your state.

 An unclaimed life insurance policy is one that a beneficiary hasn’t claimed after the insured person’s death. In these instances, a state’s unclaimed property division may hold the policy until a claim is made. Additionally, an insurance company might cancel an individual policy if there is no activity over a certain period.

When handling an estate or final expenses after someone passes away, one of the first steps loved ones should take is to locate all life insurance policies and contact the insurance agent(s) or financial services company associated with the insured. Delaying communication with the insurance company—or neglecting to do so—could result in losing thousands of dollars in benefits and cash value. This money can be essential for covering funeral expenses or settling financial obligations left by the deceased.

Unclaimed life insurance policies are treated differently from other unclaimed property. The fate of these policies varies by state. Typically, if the death benefit of a policy isn’t claimed, the proceeds along with any accumulated interest are turned over to the state after a certain period. This is why beneficiaries have a limited time to claim their benefits and collect the cash value. If you suspect a deceased loved one had life insurance, you can often determine if a policy exists and identify the carrier by contacting relevant state and federal agencies. If a loved one dies, and you’re unsure about whether they purchased a life insurance policy, there are ways to find out if they did. The Insurance Information Institute, the American Council of Life Insurers and state Insurance Department websites offer consumer tips on finding unclaimed life insurance policies. If all else fails, you can hire a private searcher to conduct the investigation. Finding lost life insurance policies can be a complicated process so here is an instructional video on how to locate a lost/unclaimed life insurance policy.

Common Reasons for Unclaimed Life Insurance Policies

Unclaimed life insurance policies arise for various reasons. One common issue is when policyholders or beneficiaries misplace key documents, such as annual statements, invoices, or the policy itself. Another cause is an insurance company going bankrupt before a claim is made. Bankruptcy proceedings can take years, and during this time, beneficiaries might move away or pass away, leaving their claims unnoticed.

Unclaimed benefits can also result from premium payments stopping before the insured person’s death. Additionally, policies might remain unclaimed if a beneficiary dies before the insured or if the policyholder provides incorrect address details for the beneficiary.

Below we explore these common reasons in more detail:

  1. Lost Contact Between Policy Owner and Insurance Company Financial institutions, including insurance companies, primarily communicate via mail. If you move, it is crucial to update your mailing address with all financial institutions to avoid losing contact. The U.S. Postal Service only forwards mail for one year and does not notify the sender of address changes. Therefore, inform your life insurer of any changes in your mailing address, phone number, or email.
  2. Insurance Company Unaware of Insured’s Death Life insurance companies usually only learn of a policyholder’s death from the beneficiary. If premium payments stop, the company has no reason to assume the insured has died. Policies with cash value features, like Automatic Premium Loan (APL), can borrow from the cash value to cover premiums, preventing policy lapse. Some policies require no premiums after a certain point, so the company stops sending premium notices. Without a master list of who is alive or deceased, insurance companies rely on beneficiaries to report deaths.
  3. Inability to Locate Beneficiaries Sometimes, the descriptions of beneficiaries are too vague, such as “my wife” or “my children,” without specific details like names, Social Security numbers, or current addresses. Detailed identification information is essential for insurers to locate and verify beneficiaries. Even if a company knows who to look for, tracking down beneficiaries can be difficult, especially if many years have passed since the policy was issued.
  4. Beneficiaries Unaware of Policy Existence Surprisingly, beneficiaries may not know they are named in a life insurance policy. The insured might not have informed them for various reasons, leading to unclaimed benefits. It’s important to inform your beneficiaries about the policy, including the insurer’s name, location, and policy number.
  5. Original Insurance Company No Longer Exists The original insurer might have changed its name or location, making it harder for beneficiaries to find and claim benefits. Life insurance companies, like any other businesses, undergo changes over time. Keeping records of any notices regarding such changes will help your beneficiaries locate the insurer and make a claim.

By understanding these common reasons for unclaimed life insurance policies, policyholders and beneficiaries can take steps to ensure benefits are claimed and used as intended.

How To Find an Unclaimed Life Insurance Policy

Life insurers do not indefinitely hold onto unclaimed life insurance policies. Instead, after a certain number of years, as determined by state laws on unclaimed property, the proceeds (often with interest) are turned over to the state where the insured last resided. Locating and claiming these policies, especially when dealing with a deceased person’s estate, can be challenging. However, there are steps you can take to streamline the process and improve your chances of success.

If you believe a deceased loved one or parent had a life insurance policy that you were unaware of, here are seven methods to locate the policy:

  1. Search Through Filing Cabinets: Start by examining old paperwork. Look for any correspondence or premium notices from a life insurance company. If you find any clues, contact the insurance company. They will need to verify your identity and require a copy of the policyholder’s death certificate (including Social Security number), but the claims process should be straightforward from there.
  2. Use Online Search Services: Several online services specialize in unclaimed money. The National Association of Unclaimed Property Administrators (NAUPA) and its endorsed site,, are valuable resources for searching unclaimed life insurance policies.

Search online databases, such as the NAIC’s Unclaimed Life Insurance Benefits Locator (ULIBL), though not all insurers provide data to this database. The National Association of Insurance Commissioners (NAIC) offers a free online tool called the Life Insurance Policy Locator Service, which can help you find life insurance policies. When you submit a request, the NAIC prompts participating insurance companies to search their records for a policy under the name of the deceased person you provided. If a matching policy is found and you are the designated beneficiary or otherwise authorized to receive the information, the insurance company will contact you directly.

  1. Contact State Insurance Departments: Since insurance is regulated at the state level, your state insurance department might have helpful information. However, be aware that they may not allocate significant resources to handling unclaimed money issues.
  2. Check with Other Insurance Agents or Brokers: Speak with the deceased’s homeowners and auto insurance agents to see if they also sold a life insurance policy to the deceased.
  3. Reach Out to Former Employers and Unions: The deceased may have had a life insurance plan through their employer. Also, check with any unions or professional organizations they were a part of, as they might offer life insurance to their members.
  4. Consult the Medical Information Bureau (MIB): As a last resort, you can contact the Medical Information Bureau, Inc. (MIB), which is a consumer reporting agency that stores information from health and life insurance entities. For a fee, MIB will conduct a search for the policy you are seeking.
  5. Thoroughly Search for Paperwork: Examine all paperwork left behind by the deceased, including tax records, bank statements, policy numbers, safe deposit boxes, credit card statements, emails, wills, trusts, and other financial records. If you find relevant documents, contact the insurer immediately.

If you cannot find any paperwork related to an insurance policy, consider these additional steps:

  • Contact the deceased’s former employer’s human resources department to inquire if they had any life insurance policies as part of their benefits package.
  • Reach out to your state’s insurance department, estate planning specialists, employers, or financial advisors who previously worked with the deceased.
  • Hire a private company that specializes in locating unclaimed policies and collecting death benefits for beneficiaries.If the policy is suspected to be highly valuable, you might consider hiring a private investigator.

Permanent life insurance policies often include a mechanism to ensure the policy remains active even if the policyholder misses a premium payment. In such cases, the insurer pays the premium from the accumulated funds in the policy’s “cash value account.” This protection prevents the policy from lapsing due to missed payments from job loss, relocation, or other reasons. However, this feature is not applicable after the policyholder’s death.

Upon the insured person’s death, beneficiaries can claim the policy’s proceeds as long as the policy was in force at the time of death. Ensuring that a life insurance policy remains active is crucial for beneficiaries to receive the rightful benefits.

Searching for a loved one’s life insurance policy can sometimes be complicated by several factors:

  • The Insurance Company Changed Its Name or Sold the Policy: The insurance company may have changed its name, merged with another company, or sold the policy to a different insurer. The NAIC offers guidance on how to locate these companies and trace the policy’s current status.
  • The Company Went Bankrupt: If the insurance company went bankrupt, contact the state life and health guaranty association. You can use the search tool provided by the National Organization of Life & Health Insurance Guaranty Associations to find your state guarantee association. These associations provide a safety net for policyholders, ensuring continued coverage up to the limits set by state law.

Steps To Reclaim Unclaimed Life Insurance Policies

Reclaiming an unclaimed life insurance policy can be a complex and time-consuming process. It requires patience and diligence, but recovering death benefits and honoring the deceased’s wishes is achievable. Begin by consulting the National Association of Unclaimed Property Administrators (NAUPA) for a complete list of requirements for your specific life insurance policy claim.

Here is a step-by-step guide to help you navigate the process of reclaiming unclaimed life insurance policies:

  1. Gather Necessary Documentation and Contact Information: Before starting the reclamation process, ensure you have all required documentation and the contact details for the insurance company. This includes copies of death certificates, birth certificates of beneficiaries, Social Security numbers, tax returns, passports, driver’s licenses, and other legal documents.
  2. Inquire About Policies and Provide Proof of Identity: With all the necessary information at hand, contact the insurer to inquire about any potential policies. The insurance company will likely require proof of identity and a copy of the deceased’s death certificate before releasing any information regarding death benefits.
  3. Provide Additional Information from Third-Party Sources: Depending on your situation and the type of policy involved, you might need to provide additional information or documentation from financial institutions or other third-party sources.
  4. Fill Out the Required Paperwork: Once you have gathered and verified all relevant documents with the insurer, complete the necessary forms to claim the death benefits. These forms come with detailed instructions, so read them carefully before submitting them along with all relevant documentation, including any applicable legal paperwork.
  5. Wait for Approval from the Insurer and Claim the Benefits: After submitting all required paperwork and verification by both parties, the final step is to wait for the insurer’s approval. Once approved, you will receive the payment of the death benefit or other funds from annuities.

By following these steps, you can effectively navigate the process of reclaiming unclaimed life insurance policies and ensure that the deceased’s wishes are honored

Lastly, if you are a policyholder, ensure your beneficiaries are informed about the benefits they are entitled to and understand the claims process. Keep a copy of insurance statements and other important estate documents in a safe place so beneficiaries are aware of active policies. If you have lost a loved one, no matter how much time has passed, it may be worthwhile to investigate the possibility of an unclaimed death benefit. You might be surprised by what you discover. For additional information and support, consider working with a financial professional who can guide you through this process and other aspects of estate planning.


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