When you feel ready to make a life insurance claim following a bereavement, take the following steps:
1. Contact the life insurance provider
You'll first need to reach out to insurance company to notify them of your intention to claim. Information about how to contact the provider will be included with the policy documentation and be posted on their website. Typically, you can contact them by post or phone. Many insurers now allow you to initiate the claims process through their website.
Life insurance policies may have been purchased decades previously and potential beneficiaries may not know from what company. It might be helpful to check the deceased's bank statements, to see to whom they were paying regular insurance premiums. Additionally, insurance firms may have changed their names or merged since the policy was purchased. The Policy Detective site can help you determine the current trading name of the insurer named on policy documentation and how to contact them.
When you contact the insurer, you'll need to initially supply the name of the deceased, their cause of death (which will be noted on the back of the death certificate), and policy number. You'll also have to identify yourself and your relationship to the deceased.
It's important to note that while anyone can start a life insurance claim, the payout will only go to beneficiaries named in the policy or in the decedent's will.
2. Gather documents required to make a claim
You'll have to provide the insurer with the following documentation to officially make a claim
- Death certificate: You can obtain certified copies from the funeral director. You may want to request several if the decedent has multiple life insurance policies.
- Completed claim form: You can obtain the form from the insurance provider themselves or from their website.
- Policy document: a certificate of insurance should have been issued with the policy when it was purchased. However, policies may have been purchased decades ago and the original documentation could have been misplaced in the interval. In that case, you should seek assistance from the ABI and/or the Unclaimed Assets Register (UAR).
3. Receive the payout
Payouts are typically processed quickly, often within a month and sometimes within a few days. There may be delays if there's dispute or uncertainty about who the beneficiaries are and or if some documentation is missing and needs to be tracked down.
Usually, the beneficiaries of a policy are clear. In the 40% of life insurance policies that are sold as joint policies, the recipient of the payout is the other person on the policy. In the case of single policies, if the deceased's spouse or civil partner is still alive, they receive the payout.
Otherwise, if the policy was set up in trust, as 6% of life insurance policies in the UK are, the payout will go to the person nominated in the policy. If it wasn't, the policy will be paid to the decedent's estate, where it will be distributed according to a will and will be subject to inheritance taxes.
If no beneficiary has been specified in the policy and there's no will (and 60% of people in the UK die without one) a court will have to name a beneficiary, which can complicate the claims process. If this is the case and especially if there's a dispute about who receives the payout, you should seek legal advice and possibly representation.
Additionally, sometimes a payout will delayed if the cause of death is unclear and needs to be investigated. Depending on the terms of the policy, claims can be rejected if the death is determined to be suicide, for instance.