Life Insurance Payout - How Long Should You Expect To Wait Before Receiving A Check?

Although, many may not think so, life insurance companies do not take great pleasure in delaying or denying a life insurance claims. Unfortunately, most times, a claim is denied or delayed because the claimants are not sending in the required forms to get the claim paid or the applicant was not all that honest at the time of application.

How long does it take before a life insurance claim is paid?

The first thing that will come into play when it is time to file a claim, is the date of issue of the life insurance policy. Most polices come with a two year fraud and suicide exclusion. If the insured dies within that time period, the insurance company has the right to more thoroughly investigate the claim and make sure that no fraud or suicide was involved in the death of the insured. We highly recommend that you stay in touch with the insurance company directly (bi-pass agent) and give them all they need to get the claim paid ASAP. If no fraud or suicide is involved the claim can get paid withing a couple of weeks.

It has been our experience that, if the insurance policy is older than two years. then a claim can be paid within a few days. A valid claim should be paid, at most, within 30 days, The only thing that the insurance company may need is a copy of the death certificate. We recommend that you contact the insurance company as soon as you have a the death certificate. You may be able to just fax or e-mail it and they may ask you to mail the original.

Steps to avoid delays in life insurance payout

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Contact the insurance company directly and ask them what they need for the claim
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Fax, e-mail and mail all needed forms and information
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Call again two days later to make sure your claim is being processed or see if they need anything else
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If you do not know the name of the company that issued the life insurance policy and have no information at all related to the claim, write to the Missing Policy Service at the: American Council of Life Insurance, 1001 Pennsylvania Avenue, NW, Washington, DC 20004-2599. Include a self-addressed business size envelope. Your inquiry will be forwarded to nearly 100 large life insurance companies in an effort to locate the lost policy. (A nominal fee will be charged to cover administrative costs.)

Other important points

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The insurance company is not the one that decides if someone committed suicide. As long as the death certificate does not say suicide, there should be no problem with the suicide exclusion
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If a valid life insurance payout is delayed, the insurance company is obligated to pay interest on the moneys being held.
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If the life insurance policy only covers accidental death and the insured died of natural causes, no claim may be paid. In case of an accident where the insured does not die right away, some questions may arise as to whether the insured died of natural causes or due to the accident.

In conclusion

The best time to find out what your life insurance policy covers is before the insured dies of course. If you read the insurance policy while the insured is living and it is not as expected, you can possibly make adjustments to the coverage. Once the insured has died, policy coverage can longer be modified. As we say in all of articles, before and after a life insurance policy is issued, ask, ask and ask as many questions as you need to. Be well!