Affordable Life Insurance Protection for Your Family

Life Insurance - Who Gets The Money?

If you are considering the purchase of life insurance, or own a policy, you may be wondering who gets the proceeds from your insurance when you die.


The Beneficiary or Beneficiaries of your policy will receive the death benefits upon your death.


However, the insurance policy must be "In Force" (paid up-to-date), and your cause of death must be covered by the insurance policy.

How Is A Life Insurance Payout Claimed?


When a loved one passes away, beneficiaries of the life insurance policy can make a claim for death benefits to be paid out on the policy, from the insurance company.

With a life insurance payout, the beneficiaries are protected from a sudden loss of financial support. That’s why many people buy life insurance, to provide financial security for their loved ones, upon their passing.

Upon the death of person insured by life insurance, beneficiaries must inform the insurance company of the insured person’s death. They will also need to file a death claim and submit an original death certificate.

Choosing a Life Insurance Beneficiary 

As part of the process when buying life insurance, you'll need to designate one or more beneficiaries. This is who you want to receive the death benefit from your insurance policy when you die. 


A Life Insurance Beneficiary can be:

  • A Spouse
  • Life Partner
  • Parent
  • Friend or Family Member
  • Sibling
  • Adult Child
  • Business Partner
  • Charitable Organization
  • Church
  • A Trust

You can choose to name a single beneficiary, or a primary beneficiary, and one or more contingent beneficiaries

contingent beneficiary would receive death benefits from your life insurance policy if the primary beneficiary passes away before the insured’s death.

Never Name A Minor Child As A Beneficiary

Child beneficiaries can only receive the proceeds from a life insurance policy when they reach age 18. 

Before adding a child beneficiary, you may want to create a trust which states the age when a beneficiary can receive the money and where the money can be used.


The passing of a life insurance policyholder triggers a series of events leading to the payout of the death benefit. If you are the primary beneficiary, it will be your responsibility to set the wheels in motion for a death claim to be paid out on a life insurance policy.


The Primary beneficiary(s) are responsible for filing a life insurance death claim, when the insured person dies.


Death Claims on a life insurance policy are usually paid quickly, often within 30 days.


Lump Sum Payouts of death benefits pay the entire death benefit at once.


Delays in Payment may be due to death occurring in the first two years of the policy, which may require a claim review of the insured’s death.


How Long Does a Life Insurance Death Benefit Payout Take?


In general, term life insurance payouts are processed within 30 to 60 days of the claim’s date. 


Beneficiaries – How To Make a Claim

Get That Original Death Certificate Ready

Order enough original copies of the death certificates so you have one to send the life insurance company. 

Life insurance companies prefer to keep the original as a valid proof of the insured person’s death.

Contact Your Life Insurance Company Immediately

Whether through a phone call or email, you should let the insurance agent and insurance company knows immediately about the insured’s death, and your claim for benefits.

Make Sure You Have Completed All Requirements

For the requirements, you can have the basics such as the claim form, the original death certificate, and the original policy. 

The companies can ask for other requirements such as police reports. 

You can ask the insurance company about the requirements before submitting anything.


What Could Deny Or Delay Payouts on Death Claims for a Life Insurance Policy?

Insurance companies review claims before paying the insured’s beneficiary the proceeds from the insurance policy. 

Not all claims are paid in an instant and some claims can be denied, or delayed for further review.

Claims can be denied or delayed due to any of the following reasons:

The Two-Year Contestability Clause

If the insured died within the first two years after the insurance policy was issued, the insurance carrier can delay the death benefit payout for up to 6 to 12 months. They also investigate the original application to ensure the insured didn’t commit fraud.

Cause Of Death: Suicide

In the suicide clause, no death benefits will be paid if the insured commits suicide within two years after the policy was issued.

In some states, the suicide exclusion is for one year.

Cause Of Death: Homicide

If homicide is listed down as the cause of death in the insured’s death certificate, the insurer will conduct further investigations with a detective to ensure the beneficiary isn’t the suspect of the death of the insured.


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