Is there a time limit for claiming life insurance death benefits?

UPDATED: May 12, 2010

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UPDATED: May 12, 2010Fact Checked

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Asked May 12, 2010

1 Answer


The answer is both yes and no. If a policy is "up to date," meaning there are no outstanding premiums due, the insurance company may not even be aware that the policy is now payable. One of the most commons ways for an insurance company to discover a payable policy, in fact, is when the premiums stop getting paid and past due accounts causing a flag in the system.

Left on it's own, a life insurance policy will begin to accrue interest on the face value beginning at the date of the policyholder's death. In theory, this amount continues to grow until it is claimed by a valid beneficiary, and can sometimes exceed the actual face value of the policy, especially in the event of the proverbial long lost relative.

In practice, most states have laws regarding unclaimed finances. This means that if a beneficiary does not step forward to claim the money within a specified period of time, that money will automatically revert to the state. The time limit is usually 7 years, but it differs from state to state, along with how you can follow up on such funds that have been transferred. This will require you to make thorough records searches in all states where you have lived, or where deceased relatives may have lived.

Answered May 12, 2010 by Anonymous

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