The Unclaimed Life Insurance Benefits Act

This act requires insurers to periodically check if they need to pay out unclaimed life insurance benefits. You can use services such as the NAIC policy locator to find out if you can claim benefits from an existing policy.

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Katherine MurbachEditor & Licensed Life Insurance AgentKatherine Murbach is a life insurance and annuities editor, licensed life insurance agent, and former sales associate at Policygenius. Previously, she wrote about life and disability insurance for 1752 Financial, and advised over 1,500 clients on their life insurance policies as a sales associate.&Tory CrowleyAssociate Editor & Licensed Life Insurance AgentTory Crowley is an associate life insurance and annuities editor and a licensed insurance agent at Policygenius. Previously, she worked directly with clients at Policygenius, advising nearly 3,000 of them on life insurance options. She has also worked at the Daily News and various nonprofit organizations.

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Antonio Ruiz-CamachoAntonio Ruiz-CamachoAssociate Content DirectorAntonio helps lead our life insurance and disability insurance editorial team at Policygenius. Previously, he was a senior director of content at Bankrate and CreditCards.com, as well as a principal writer covering personal finance at CNET.
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Ian Bloom, CFP®, RLP®Ian Bloom, CFP®, RLP®Certified Financial PlannerIan Bloom, CFP®, RLP®, is a certified financial planner and a member of the Financial Review Council at Policygenius. Previously, he was a financial advisor at MetLife and MassMutual.

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The Model Unclaimed Life Insurance Benefits Act, also known as the National Council of Insurance Legislators (NCOIL) Model Act, standardizes the process for handling unclaimed life insurance policies to help reduce the number of outstanding claims.

What is the Model Unclaimed Life Insurance Benefits Act?

Originally adopted in 2011 by the National Council of Insurance Legislators (NCOIL), the Model Unclaimed Life Insurance Benefits Act helps tens of millions of dollars of unclaimed life insurance money get into the hands of the intended beneficiaries in a timely manner. [1]

  • The model act requires insurers to periodically search the Death Master File (DMF), the Social Security Administration’s (SSA) database for determining that a person has died. [2]  

  • These required checks help insurers to identify deceased policyholders, find policies with unclaimed life insurance benefits, and pay out the funds to the policy’s beneficiaries within 90 days if there’s a match. 

Many states have adopted their own versions of the NCOIL Model Act since its inception in 2011. And most major life insurance companies, even in states that haven’t enacted this model legislation, follow the act’s recommendations. You can check your state department of insurance to see whether your policy — or a loved one’s policy— is covered under legislation based on this act.

What happens to unclaimed life insurance money?

After a certain number of years — usually three, but each state has its own regulations — the unclaimed funds are turned over to the state in which the policyowner last lived. This transfer of property to the state is known as “escheat.”

It’s rare, but sometimes this can happen if someone with a life insurance policy dies and their beneficiaries don’t know about an existing policy. Other times beneficiaries may forget to file a claim for benefits in the midst of grieving.

How does an escheat work?

After an unclaimed benefit is transferred to the state, the state must make an effort to find the beneficiary before the money is officially turned over to the state treasurer.

  • If your beneficiaries never claimed benefits, life insurance companies assume the policyholder is dead on what would be their 120th birthday and disperse the death benefit to any living beneficiaries. This is known as the “limiting age” in your policy.

  • To ensure that beneficiaries get the life insurance payouts they were owed within a more reasonable time period, the National Council of Insurance Legislators created the Model Unclaimed Life Insurance Benefits Act. 

  • This act and other laws have forced insurers to turn over unclaimed benefits to the state in which the policyholder lived after a certain period of time. 

By placing the death benefit money with the state (and out of the hands of the insurance companies), beneficiaries can more easily check state databases for unclaimed benefits.

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How do you find out if you have unclaimed insurance benefits?

The National Association of Insurance Commissioners (NAIC) and some state insurance departments have created tools to help consumers search for lost life insurance policies.

If you’re not sure there’s an existing policy in the first place, you can start by checking these two resources.

  • Life Insurance Policy Locator Service: Created by NAIC, this lookup tool asks for information such as your address, relationship to the deceased, and the deceased’s Social Security number, then asks their partner insurers to search their records for matching policies. 

  • MissingMoney.com: This site, endorsed by the National Association of Unclaimed Property Administrators (NAUPA), aggregates state records of unclaimed funds.

If you’re certain there’s an existing policy, you can take the following steps.

  • Contact your state through their department of insurance website

  • Contact the life insurance company that issued the policy

  • Contact the deceased’s financial advisors

  • Search for the physical copy of the policy

  • Search digital storage for the policy documents

It may take up to 90 business days to hear from an insurer if a policy is found. The insurance company will contact you directly if you’re an authorized beneficiary or are otherwise allowed to get information about the missing policy.

Learn more about how to find out if someone had life insurance

References

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Policygenius uses external sources, including government data, industry studies, and reputable news organizations to supplement proprietary marketplace data and internal expertise. Learn more about how we use and vet external sources as part of oureditorial standards.

  1. National Council of Life Insurance Legislators

    . "

    History & Purpose

    ." Accessed February 08, 2024.

  2. National Association of Insurance Commissioners

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    NAIC Model Laws

    ." Accessed February 08, 2024.

Authors

Katherine Murbach is a life insurance and annuities editor, licensed life insurance agent, and former sales associate at Policygenius. Previously, she wrote about life and disability insurance for 1752 Financial, and advised over 1,500 clients on their life insurance policies as a sales associate.

Tory Crowley is an associate life insurance and annuities editor and a licensed insurance agent at Policygenius. Previously, she worked directly with clients at Policygenius, advising nearly 3,000 of them on life insurance options. She has also worked at the Daily News and various nonprofit organizations.

Editor

Antonio helps lead our life insurance and disability insurance editorial team at Policygenius. Previously, he was a senior director of content at Bankrate and CreditCards.com, as well as a principal writer covering personal finance at CNET.

Expert reviewer

Ian Bloom, CFP®, RLP®, is a certified financial planner and a member of the Financial Review Council at Policygenius. Previously, he was a financial advisor at MetLife and MassMutual.

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