What happens to unclaimed life insurance money?

After a certain number of years, as defined by each state, insurance companies must turn over unclaimed life insurance money to the state government. Some states are placing pressure on life insurance companies to pay out unclaimed death benefits. Because of this, insurance companies routinely use Social Security data to check to see if policyholders are still alive. When they find out that an insured passed away, they’ll do research to try to find the beneficiaries.

How long does a beneficiary have to claim a life insurance policy?

The good news is that there’s generally no time limit for a beneficiary to claim a life insurance policy. Whether it’s been a few months or several years, the payout is still available as long as the policy was active when the insured passed away. However, it’s always a good idea to file a claim as soon as possible to avoid any complications or delays. Once the claim is submitted, the insurance company typically has 30 days to review it and either approve, deny or request additional information to process the payout.

How do I find out if a life insurance policy is valid?

To find out if a life insurance policy is valid, you can check with the National Association of Insurance Commissioners. Using the NAIC Life Policy Locator, you can submit a request with the legal name, date of birth, Social Security number and date of death for the deceased person to find a life insurance policy or annuity.

How to track unclaimed life insurance

Written by

Ashlyn Brooks,

Edited by

Natasha Cornelius, CLU

Published on September 19, 2024 | 6 min read

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Consumer investigating unclaimed life insurance from his kitchen

Key takeaways

Life insurance benefits may go unclaimed if beneficiaries are unaware of the policy. It’s important for policyholders to inform their loved ones about existing policies.
Searching for unclaimed life insurance policies can involve various methods, including looking through personal records, using policy locators and contacting insurance companies.
The Unclaimed Life Insurance Benefits Act helps ensure unclaimed policies don’t get overlooked, but it’s not in effect in every state.
Beneficiaries can claim life insurance policies at any time, but filing a claim as soon as possible is recommended to avoid potential delays.

Life insurance provides peace of mind, ensuring loved ones are financially protected after you’re gone. However, insurance companies don’t automatically know when a policyholder has passed away, leaving the responsibility to claim benefits on the shoulders of beneficiaries. It’s up to the policyholder to make sure their beneficiaries know a policy exists — a conversation that can be difficult and uncomfortable but necessary. While some insurance companies may check death records, like the Master Death File, this process could take years. If you think benefits may be waiting, it’s time to start an unclaimed life insurance policy search to uncover any forgotten or overlooked policies. Let Bankrate help you get started on the right path.

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How to find an unclaimed life insurance policy

If you suspect a loved one purchased a life insurance policy but never mentioned it, or you’ve recently lost someone and believe there might be unclaimed benefits, you’ll need to know how to track unclaimed life insurance policies. Fortunately, there are several ways to begin your search.

Start by gathering key details about the deceased, such as their full legal name, date of birth, Social Security number and any former addresses. With this information in hand, you can follow the steps below to increase your chances of finding unclaimed life insurance policies.

Search for insurance policy paperwork

You may be able to find insurance policy paperwork — including premium payment receipts or bank statements showing an automatic deduction — more easily if the person passed away recently. Also, check address books or electronic devices (if you have access) for any insurance-related transactions or communication.

If you’re the executor of the deceased’s estate, check through safe-deposit boxes and personal files that may store the paperwork. You could also visit the bank of the deceased to request paper statements if you have power of attorney. This will allow you to see who premiums were paid to if you don’t have access to the deceased’s online bank account.

Turn to a missing policy locator

The National Association of Insurance Commissioners’ Life Insurance Policy Locator Service and similar services allow consumers who believe they are the beneficiary of a life insurance policy to submit a life insurance policy search by name and request to have insurers check their files. These systems can serve as an unclaimed life insurance database for individuals that need a starting point for retrieving policy information.

Search for the insurance company

If you find evidence of a policy and can identify the insurance company, most of your work is done. Beneficiaries who can’t locate the insurance company listed on a policy should contact their state’s insurance department.

If you know the insurance company, follow its steps to file a claim. Provided you give all the information and the insurance company approves your claim, the company will typically provide payment in a timely manner.

Make sure you’re looking in the correct state

You need to know where the policy was purchased. The state where the decedent passed may not be the same state they purchased the life insurance policy. Check in any prior states the person may have lived in to find an unclaimed life insurance policy. Once you’ve located the correct state, you can use its Department of Insurance (DOI) site, which contains tools to search for insurance policies.

If the insurance company went out of business, the DOI should have records of what happened to the policies.

Search for a financial connection

A financial connection would be a professional who handled the deceased’s finances. This could be an accountant, financial planner or insurance agent. A professional working in financial services would likely have knowledge of a life insurance policy, and may even have a copy of it proving you’re the beneficiary and provide policy details. You’ll likely have to provide information to verify your identity or prove that you’re the executor or have power of attorney for the deceased before the financial professional releases the information.

Search unclaimed property files

MissingMoney.com, a database endorsed by the National Association of Unclaimed Property Administrators (NAUPA), allows you to search for unclaimed property in most states. The NAUPA maintains a web tool for searching through unclaimed matured life insurance policies. To start the search, all you need is the name, city and state where the deceased lived, and you can conduct the research online.

Contact the deceased’s former employers

Most life insurance policies purchased through employers are term policies that provide coverage only during the time of employment, but sometimes an individual will continue the policy after leaving the company. You might want to check with former employers, labor unions or professional associations to see which company the deceased had life insurance with so you can contact the insurer directly.

Many companies won’t provide specific information pertaining to employees outside of when they worked there and their position, so asking what life insurance company they use is a way around this.

Pay for a professional service

If you believe there’s a life insurance policy out there with your name on it, but you’re unsure where to start, a professional search of the Medical Information Bureau (MIB) database can be a helpful option. The MIB is a central hub where life insurance companies store confidential, coded information related to medical conditions and risk factors. For $75, you can request a search of this database to track down policies where you may be listed as a beneficiary.

In addition to the MIB, you might also consider a service like Policy Inspector, which conducts a comprehensive life insurance policy search for $119. Policy Inspector digs deeper, helping locate potential policies across various insurance providers. While both services come with a fee, they could be worthwhile investments if you’re confident an unclaimed policy exists.

Once you’ve located the insurance company, the next step is to contact them directly to determine if the policy is still active and to learn about the process for filing a claim.

The Unclaimed Life Insurance Benefits Act

Although not available in every state, the Unclaimed Life Insurance Benefits Act aims to help fill the knowledge gap between life insurance companies and the government’s official documentation of deceased citizens. It requires that life insurance companies compare their records to the Social Security Administration’s (SSA) Death Master File to ensure that the company is aware of any policyholders that may be deceased. This act aims to encourage the proper transition of unclaimed life insurance benefits into the hands of the appropriate beneficiaries. If beneficiaries cannot be found after a set number of years, the insurance company must transfer any unclaimed benefits to the state’s Department of Revenue as unclaimed property.

This act can potentially help beneficiaries of life insurance policies by reducing the number of unclaimed policies and accelerating the process of discovering when a life insurance policy has matured. Often, notifying a life insurance company has fallen upon the deceased’s family. This act allows for an alternative that puts the onus of information back upon the insurer. With the SSA’s Death Master file for comparison, insurers are less likely to remain unaware of the death of a policyholder.

This law is not in effect in all states, as some have yet to sign it into state law. However, even in states where this act is not signed into law, many insurers have chosen to comply with its requirements. Check your state regulations on the DOI website to see if your state has passed this act.

How to prevent unclaimed life insurance policies

While the deceased cannot provide you with information on their insurance policies, you can take actions to prevent the same from occurring in the future.

If you are covered by life insurance, tell your loved ones that you have a policy so they don’t miss out on your death benefit if you pass away. Provide details about the policy, like the insurance company, policy number and coverage amount. Give your insurance company as much detail as possible about your beneficiaries, including names, addresses and Social Security numbers, to make it easier for the insurance company to find them. It’s also a good idea to store life insurance paperwork in a secure place so family members have access to it when they need it.

Frequently asked questions

After a certain number of years, as defined by each state, insurance companies must turn over unclaimed life insurance money to the state government. Some states are placing pressure on life insurance companies to pay out unclaimed death benefits. Because of this, insurance companies routinely use Social Security data to check to see if policyholders are still alive. When they find out that an insured passed away, they’ll do research to try to find the beneficiaries.
The good news is that there’s generally no time limit for a beneficiary to claim a life insurance policy. Whether it’s been a few months or several years, the payout is still available as long as the policy was active when the insured passed away. However, it’s always a good idea to file a claim as soon as possible to avoid any complications or delays. Once the claim is submitted, the insurance company typically has 30 days to review it and either approve, deny or request additional information to process the payout.
To find out if a life insurance policy is valid, you can check with the National Association of Insurance Commissioners. Using the NAIC Life Policy Locator, you can submit a request with the legal name, date of birth, Social Security number and date of death for the deceased person to find a life insurance policy or annuity.