Your Life Insurance Windfall on Death

One of the problems with many estates is the records are incomplete or unorganized. The executor and beneficiaries often don’t find out about all the assets available to them. One ripe source of unclaimed benefits is life insurance. Some estimate that there is $1 billion in unclaimed life insurance benefits. Many of the policy benefits probably are small. People often forget that they receive life insurance through employers, association memberships, and other sources. But sometimes a sizeable policy isn’t known to the beneficiaries.

It’s not easy to find unclaimed insurance benefits. Here’s a guide to the steps you can take to locate life insurance benefits you might be owed. (Subscription might be required.) Some insurers are being proactive in locating beneficiaries, but few are doing it at the moment. The burden is on you to find out if you are owed anything.

The American Council of Life Insurers, a trade group, lists on its website search tips including checking with the benefits office at a loved one’s latest and previous places of employment, or a union welfare office. It also suggests checking canceled checks to see if any were written to pay premiums.

The ACLI also advises checking the mail for one year after the death for premium notices, which usually are sent annually. If a policy has been paid up, there won’t be a notice of payments due, but the company might still send an annual notice about the policy and pay a dividend, the ACLI says.

Also, the group recommends reviewing old income-tax returns, looking for interest income from, and interest expenses paid to, life-insurance companies.