Once a policyholder has passed away, beneficiaries typically receive life insurance notification within 90 days of the death. However, this can vary depending on the insurer, and whether they're able to locate all beneficiaries.
The bottom line is that life insurance companies do not monitor policyholders, which means that the executor or beneficiaries must initiate a claim. The insurance company will not seek out the beneficiaries of a decedent; they will be unaware of the death until a claim is initiated.
The timeline is much shorter. California laws, for example, require that beneficiaries are notified within 60 days of the death.
The companies will search their records to determine whether they have life policies or annuity contracts and will contact you directly only if they find a policy in the name of the deceased and you are the designated beneficiary or authorized legal representative. This service is free of charge.
A Beneficiary need not know about a trust of which he or she is a Beneficiary, and neither the Settlor nor the Trustee (if the Settlor waived the requirement for the Trustee to keep the beneficiaries informed) needs to inform the Beneficiary of the existence of the trust; but if the beneficiary finds out about it and ...
An Executor's Disclosure Responsibilities
The executor's first duty to beneficiaries of the will is to identify, locate, and contact them to advise them of their status as beneficiaries. This should be done in writing. A beneficiary of the will has the right to a copy of the will, which the executor should provide.
A typical timeline
While there is no strict deadline, beneficiaries are usually notified within a few weeks to a few months after someone's death.
Depending on the complexity of the estate, the probate process, if applicable, generally takes at least six months to a year. And that's usually for the best, says Private Wealth Advisor Cheryl Smith. Too often beneficiaries make large purchases or sweeping decisions that they later regret.
Do life insurance companies contact beneficiaries? Many life insurance companies try to contact beneficiaries if the beneficiaries don't contact them first. The “catch” is that there's no automatic process that tells them about policyholder deaths.
Life insurance companies typically do not know when a policyholder dies until they are informed of his or her death, usually by the policy's beneficiary. Even if a policy is in a premium-paying stage and the payments stop, the insurance company has no reason to assume that the insured has died.
In many cases, it takes anywhere from 14 to 60 days for beneficiaries to receive a life insurance payout. But many factors impact this time frame. These include the insurance company's procedures, when the claim is filed, how long the policy was active, the cause of death, and state laws regarding insurance payouts.
A will cannot override a beneficiary designation because the policy is a contract between the person who purchases it and the issuer. The only way anyone can override a beneficiary other than the policyholder is if a court determines there's a conflict between named beneficiaries and state laws.
Life insurance policies may be listed in public records. The first place to check is your loved one's will. If your loved one went through a divorce, a life insurance policy may be listed as an asset in those proceedings.
Beneficiary of a Will
If you're not sure you were named as a beneficiary in someone's Will, check with the probate court in the county where the decedent lived. Since it is a public record, you can request to see the Will's filing.
Contacting beneficiaries
The executor or personal representative will contact each beneficiary. That is often done through written communication, such as a letter or email, providing details about the deceased's passing, their role as executor, and the beneficiary's rights and entitlements.
For instance, California probate code provides that beneficiaries of a trust must be notified by the trustee within 60 days of the trustor's death.
If you are the designated beneficiary on a deceased person's bank account, you typically can go to the bank immediately following their death to claim the asset. In general, there is no waiting period for beneficiaries to access the money; however, keep in mind that laws can vary by state and by bank.
Beneficiary Rights and Accounting
According to California Probate Code section 10950, if more than a year has passed since the beginning of probate administration and an accounting has not been filed, interested parties are entitled to file a petition with the court to make the executor to complete an accounting.
Q: Can an Executor Withhold Money From a Beneficiary in California? A: Executors do not have the authority to act outside the guidelines stipulated in the will. An executor cannot withhold money from a beneficiary unless they are directed to do so through a will or another court-enforceable document.
You will know that someone left you an inheritance if they tell you, if it's included in their will or trust, or if you're named as a beneficiary on an account.
Life insurance companies sometimes notify beneficiaries, but they often have imperfect knowledge. In many cases, life insurance companies may not be aware that a policyholder passes away or may not have current contact information for beneficiaries.
Also, death certificates are issued by local government agencies who aren't required to notify life insurance companies every time a citizen passes away. So, insurance companies typically don't even know that a policyholder has passed away until someone submits a beneficiary claim.
Steps You Need to Take
In your web browser, navigate to naic.org, hover over Consumer, and click Life Insurance Policy Locator under Tools. Submit a search request by entering the deceased's information from the death certificate: Social Security number. Legal first name.