How Life Insurance Works

Life insurance provides important protections for those left behind, but it is important to take the right steps when filing the claim. Dealing with insurance companies at the time of loss can be extremely difficult, but it is important to start the process as quickly as possible.

The first step is to locate the insurance policy itself. Hopefully the original life insurance policy had been placed in a safe deposit box or other safe place. If not it may be necessary to contact the insurance company for the proper paperwork. After the policy has been located the real work of filing the claim can begin.

Before getting started it is a good idea to obtain several copies of the death certificate. These copies will make it easier to file the claim, so be sure to ask for several extra copies. The death certificate is the standard form of documentation that will be required by the insurance company. If a death certificate is not available it is important to ask the insurance company if another form of documentation can be used in its stead. The representative handling the claim should be able to provide the necessary information regarding what types of documentation are needed to move the claim forward. The funeral director handling the services should be able to provide certified copies of the death certificate.

In some cases the insurance policy will have been provided by a former or current employer. If that is the case it is important to contact the deceased’s employer as quickly as possible. When making that contact it is important to provide as much information about the insured as possible, including their date of birth, dates of employment, annual salary and other important information. Having this information at hand will make it easier to get the claim process started.

Before actually filing the claim it is a good idea to contact the agent who originally placed the policy. The insurance agent should be able to provide more detailed information regarding what types of documentation are needed. He or she should also be able to provide the necessary paperwork. It is important to complete all the forms accurately. Any inaccuracies or incomplete documents could cause a delay in the payment of the claim.

After the claim has been submitted the next decision to be made is how the policy benefits are to be paid. Most life insurance policies will provide a number of payment options, including lump sum payments and lifetime recurring payments. It is important for the family members named as beneficiaries to determine the best type of payment options for their needs. Some families will prefer to take the lump sum payment and invest it on their own, while others will be more comfortable knowing that they will receive monthly or annual payments for the rest of their lives.

Taking these important steps as soon as possible following the death of the insured is the best way to get the ball rolling on a life insurance claim. Dealing with life insurance is never a pleasant task, but it is important that the beneficiaries of the policy receive the proceeds of the policy their loved one worked so hard to provide.