How Long Does It Take to Process a Life Insurance Policy Claim?

Incomplete or inaccurate paperwork can result in a longer than usual processing time.

Incomplete or inaccurate paperwork can result in a longer than usual processing time.

Losing a loved one can be a devastating and life changing experience. In addition to the emotional impact, this may also result in an abrupt change in your household finances, particularly if you relied on this individual for assistance in paying for living expenses or other bills. This financial burden can often be lessened if the deceased person has a life insurance policy for which you were named the beneficiary.

Filing a Claim

To initiate the claim process, you’ll need to contact the insurance company to inform it that the policyholder has passed away. You’ll then be instructed to complete an actual claim form along with a claimant’s statement. The insurance company will also require a certified copy of the death certificate in order to review, process and approve your claim for benefits.

Processing Time

Once you’ve submitted all of the requested paperwork, the insurance company should begin processing the claim. Most claims are processed and paid within 30 days of the date of your application. However, processing times vary by company. If more than a month has passed without a response, be sure to follow up with the insurance company to check on the status of your claim form and to make sure all of your information was received. Incomplete forms, missing documents and inaccurate data can all result in delayed approval.

Receiving Your Benefits

Once your claim is approved, the life insurance proceeds are then sent to you as the beneficiary. If multiple beneficiaries were elected, the proceeds will be divided and distributed accordingly. The most common way to receive life insurance benefits is through a lump-sum payment, which is typically sent in the form of a certified check or via direct deposit to your bank account. Some insurance companies may also offer alternate settlement options which allow the proceeds to be evenly distributed over a specified period of time. Whichever method you choose, rest assured that you won’t have to pay income taxes on the life insurance funds.

Denied Claims

Unfortunately, not all life insurance claims are approved, so be sure to examine the summary plan description for your loved one’s policy if you question the decision. Some policies, for example, specifically list exclusions such as suicide, which would prevent benefits from being payable upon the policyholder’s death. Failure to disclose a known serious medical condition would be another example of a possible deal breaker when it comes to approving a life insurance claim.


About the Author

Based in Virginia, Amanda Banach has been a writer since 2009. Her professional work experience includes roles in media advertising, financial services and human resources. She holds a Bachelor of Arts in human resources management and is PHR-certified.

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