Enrolling in a life insurance policy is an excellent way to take care of loved ones in the event of an untimely death. As an asset for long-term financial planning, it’s important to understand how funds will be distributed to ensure you receive the designated benefits from your loved one. If you’ve recently experienced the loss of someone in your family, learn how life insurance works and what you can expect regarding payouts below. 

How Do You File a Claim?

When a loved one passes away, you will need to file a claim with the carrier of their life insurance policy. To file a claim, you will need several different documents, including a claims packet, copy of the policy, death certificate, obituary, and proof of your identity.  

The claims packet contains forms that are completed on a paper version or online and will ask for information regarding you and the policyholder. This packet will require signatures, as well as your decision on how you would like the policy to be paid out, typically as a lump sum or an annuity. You will also need to include a completed copy of the policy to help expedite the process.

The other materials provided when submitting a claim provide proof of the decedent’s identity and death, as well as authenticating that you are the beneficiary. You may be asked to provide a photo ID, birth certificate, or social security card, depending on the carrier.

How Long Does It Take to Receive Funds?

Distribution of funds can take anywhere from a few weeks to a few months. This will largely depend on how quickly you are able to submit the claim, in addition to the required documents. Once the carrier receives this information, they will review the forms and release your payment. Delays can occur for various reasons, including the contestability period or the investigation of policy lapses, so it’s important to keep proper notes on all related documents.

If you are looking for additional protection for your loved ones in the event you pass away, speak with the team at Southern Insurance Associates in Hixson, TN, about their life insurance coverage. As representatives of more than 70 insurance companies, the professionals can find the policy you need, whether it’s auto insurance or commercial coverage for your business. To learn more about their benefits, visit them online or call (423) 296-0626.