Here’s what you need to know about the distribution of life insurance benefits.
If your family’s main breadwinner has passed away suddenly, then you may already be feeling the financial impact of their loss. This is why you might be worried about how quickly you will receive your loved one’s life insurance benefits. Here’s what you should know about the distribution of life insurance benefits.
How quickly will I receive benefits?
According to the American Council of Life Insurers (ACLI), life insurance benefits are usually paid within 30 days of the insurance provider receiving the claim. If you have all the necessary documentation, then you can receive compensation as quickly as ten business days.
Delays
Some of the common issues that can cause a delay in benefit distribution include the following:
- Missing information or documentation– If the claim form is incomplete or inaccurate, then this will slow down the process. Additionally, if you do not provide a certified death certificate for your loved one, then this too will cause delays.
- Suicide– Many life insurance policies include a clause stating that benefits will not be distributed if the policyholder dies from suicide within the first two years of the policy term. If the insurer suspects suicide within that time frame, they will investigate. This will delay or even cancel the benefits distribution process.
- The death occurred during a contestability period– A contestability period is usually the first two years after a life insurance policy has been secured. If the policyholder dies during this period, then the life insurance company has the right to investigate the claim. Should an investigation ensue, then benefits can be delayed or not paid out at all.
This is what you should know about how life insurance benefits are paid out. Do you have additional questions regarding your life insurance coverage? If so, then contact the experts ISU-Wissink Insurance in Culver City, New York. Our dedicated team is eager to assist you with all your personal insurance needs today.