Claim on life insurance policy

How do I claim on life insurance policy (and pensions)?

Claiming on life insurance promptly may ease the whole process of sorting out a death by bring in some useful cash.

However, there can be problems claiming on life insurance policy or policies:

  • Sometimes policy premiums may not have been kept up to date, so the policy may not be valid.  This is clearly disappointing but the company may treat the death claim sympathetically if the circumstances are right.  It is always worth submitting a claim.
  • If the policy was taken out relatively recently, the insurer may be concerned that death resulted from something which was known about but not disclosed on the application form.  This could result in the death claim being refused, but would cause some delay while the matter was investigated.
  • Where suicide is suspected, most insurance companies have the right to refuse to pay a claim if the policy is fairly new.
  • The policy may be “in trust” which means that the trustees of the policy (probably you will be one) must make the claim, and the proceeds can only be distributed to the people nominated by the trust which would typically be the spouse/ partner and children – but not necessarily.  You need to find out.
  • If the policy pays out to the estate (and sadly 94% of policies do) then it is an asset for Inheritance Tax purposes and must be declared as such during the probate process, with the inevitable delay in payment.
  • You may not be able to find either the policy or the insurance company.
  • The policy may be an old one which has been cashed or cancelled, or in the case of a pension, transferred.

How do I find out if there is a life policy to claim on?

Pretty much all policies these days are paid by direct debit, with the exception of some policies which are either:

  1. Paid up – that is, premiums are no longer being paid, but the policy still has value.
  2. Investment policies which are often called investment bonds.

So if you have the policy documents to hand it is relatively easy (though you may find that some of the policies are no longer valid as they have been cashed or cancelled).

If not, look for the names of insurance companies on the bank statement.  Most are paid monthly, but some are quarterly or even annual, so it is certainly worth looking back at least a year.  But that won’t help with paid up policies – if you think their might be one, and you can’t find any paperwork, you could search for it – and lots of other things – at the Unclaimed Assets Register.

Other sorts of policies with death benefits.

Most pension schemes have some sort of death benefit.  Sometimes it is only a reduced pension for the spouse or other dependents.

But many other schemes will have additional benefits, especially before a pension income starts to be drawn.  If it is a company scheme, talk to the company, if not speak to your financial adviser if you have one.   If you use our probate service , we can do all that for you if you wish (and that may be cheaper).

How to claim a live insurance policy death benefit.

Ring each company up, ideally with the policy documents or any other details you may have in front of you.   They will tell you what else you need to do, and they will usually send out a claim form for you to complete.

Once you have the death certificate and have filled in the claim form, send it back to the company.   They will raise an questions they still need answered, and will normally require proof of your identity to confirm you are entitled to the benefits.

Depending on the size of the policy and whether it is in trust or not the company may require a Grant of Probate before they will pay anything out.   This will generally delay things substantially.

How do I find the contact details of the life insurer to make a claim?

Try the number on any details you, or do an internet search.  If that doesn’t find the right company, there have been dozens of mergers and takeovers.  The Association of British Insurers have an online database to help you find the current contact details of the insurance company.

Contact details for claims on company pension schemes.

The same is true of company pension schemes: a company may go bankrupt, but its pension scheme may live on.  Here is the free pension tracing service.

Help?  The Probate Department Ltd offer sensibly priced help with any part of the probate service, including claiming on life insurance policies.