6 Steps for Finding a Lost Life Insurance Policy

According to the CDC (Centers for Disease Control and Prevention), The Covid-19 pandemic drove average life expectancies in the United States down by 18 months last year (the calendar year 2020), making it the largest decline since World War II. 

Americans are now expected to live an average of 77.3 years, down from 78.8 years in 2019.  Covid-19 deaths accounted for nearly 75% of the decline.  About 11% of the decline stems from the rise in deaths from accidents and/or unintentional injuries.  Drug overdose deaths (+30%) make up about one-third of unintentional injuries last year. 

Life expectancy for American women dropped by 1.2 years in 2020 and men dropped by 1.8 years.  The gap between men’s life expectancy and women’s life expectancy has widened to 5.7 years in 2020 from 5.1 years in 2019. 

What does this all mean?  It means that planning should be adjusted for a shorter life.  As interest rates rise, annuities will play a larger role in planning as will Life Insurance.  Compared to pre-pandemic times, people have shifted their relationship to mortality and death and are able to discuss it more comfortably.

When someone dies, it’s not uncommon for their life insurance benefits to remain unclaimed because their beneficiaries didn’t know about the policy.   Life insurance companies try to contact beneficiaries however people often move, don’t check their emails, and sometimes change their names.  Fortunately, there are solutions for tracking down policies by using these 6 tips!

1. Search for Insurance Documents: Look through paper files, financial folders, safe deposits boxes or home safes.  Check for bills, the insurance broker’s business card, the cell phone or address book of the deceased for information.
2. Check Financial Records: Check bank statements, financial ledgers, and copies of checks to see if payments were made to any insurance companies.
3. Contact the Decedent’s Employer: If the decedent was employed or recently left a job check with their employer.  Many companies offer small group term policies that could cover funeral expenses.  Also, these group plans may have been continued or converted into a permanent policy when the job ended.
4. Contact the Unclaimed Property Office: Every state has a department for unclaimed property.  If a life insurance company is aware of the death of a policyholder and cannot locate the beneficiary, the policy is reported to the unclaimed property office in most cases.  The funds are submitted to the unclaimed property office in the state where the policy was purchased.  If the decedent moved several times, it may be necessary to contact the offices of each state they resided in the past.
5. Check the MIB Database: The MIB group (Medical Information Bureau) is a not-for-profit company made up of life and health insurance affiliates.  They keep a database of all policies written in 1996 or after by companies that are members of the group.  Since the fee is about $75 save this as the last resort.
6. Tell Family, Beneficiaries and/or Friends:  Many people never tell their beneficiaries about their policy because of the grim nature of the subject.  We suggest completing a simple “estate directory” which lists policies, beneficiaries and where the files are being kept. 

To learn more, feel free to contact us at [email protected].