Life Insurance Plans

Step 1: Gather important documents

It can be tough to find the energy or focus after the loss of a loved one, let alone compile all the information required for a life insurance claim. However, having all of your documentation in order can speed up the process and allow you to get paid sooner. Fortunately, claiming a policy’s death benefit requires only three documents:

• Death certificate: Certified proof of death helps to prevent fraud by ensuring that policies are claimed legitimately. You won’t have to personally apply for a death certificate in most circumstances. Instead, you’ll need to seek a copy from the person who prepared it, which is generally the funeral home or the medical practitioner who confirmed the death time and location. You can also get a copy of the death certificate by phone, in person, or online from your local key records office.
• Policy document: The policy paper contains all the relevant data about the life insurance plans, such as the term, death benefit amount, policyholder information, and so on. The insurer will check this against its records to ensure that you’re registering a claim under the correct policy. If you can’t find the life insurance policy document, reach out to your insurance company or their financial counsellor.
• Claim form: That’s where you fill out details about the policyholder, such as their policy number and cause of death, also known as a “request for benefits.” You’ll also specify your relation to the policyholder as well as how you want to be reimbursed once the insurance company has completed its investigation.

Step 2: Contact the insurance company:

You’ll need to contact the life insurance plan company that issued your life insurance policy to inform them of the death and make your claim once you’ve gathered all of your papers.

What is the deadline for filing a claim?

When it comes to lodging claims, there is no time constraint. If your loved one’s policy was current at the time of death, you have the right to claim a death benefit any time after they died. However, the earlier you file a claim, the faster you’ll be compensated.

Step 2: Contact the insurance company:

You’ll need to contact the life insurance plan company that issued your life insurance policy to inform them of the death and make your claim once you’ve gathered all of your papers.

What is the deadline for filing a claim?

When it comes to lodging claims, there is no time constraint. If your loved one’s policy was current at the time of death, you have the right to claim a death benefit any time after they died. However, the earlier you file a claim, the faster you’ll be compensated.

Step 2: Contact the insurance company:

You’ll need to contact the life insurance plan company that issued your life insurance policy to inform them of the death and make your claim once you’ve gathered all of your papers.

What is the deadline for filing a claim?

When it comes to lodging claims, there is no time constraint. If your loved one’s policy was current at the time of death, you have the right to claim a death benefit any time after they died. However, the earlier you file a claim, the faster you’ll be compensated.

Step 3: Wait for the claim to be processed .

The insurance company will run a few simple checks after you’ve taken care of everything on your end. The insurance company will first check to see if the policy is still effective. Policies lapse when the policyholder stops paying premiums or when the coverage period on term insurance expires.

After that, an agent will validate that you are the authorized beneficiary of the policy. You may be required to show a driver’s license, social security card, or birth certificate as proof of identity. If you are not a citizen of the United States, you may be required to complete additional paperwork.

The insurer might pay out a death benefit within a few days, given how long it takes to process a claim, but it could take up to 60 days or longer for non-US nationals or persons living outside the country. Insurers are compelled to pay out as soon as possible in order to avoid paying interest on outstanding death pay outs. Because each state has its own requirements, consult with your insurance company to figure out what their deadline is.

Step 4: Receive the death benefit 
There are a few alternative ways to obtain the death benefit based on the insurer as well as the plan. Lump payments and annuities are the two most basic and popular options:

• Lump sum

You’ll receive the complete death benefit in one go and can use it to pay for a funeral, a mortgage, and other expenses right away. You won’t have to pay any taxes on it either.

• Annuity

An annuity is a type of arrangement in which the death benefit is invested and subsequently paid back in annual payments for a specified number of years, starting at a future date. Gains on investments are taxed.

Step 5: Layout your final wishes 

Your beneficiaries will most likely assume your financial duties after receiving the death benefit payment. While a death benefit will safeguard them from financial hardship, they will still have to deal with the added stress of adjusting to a fresh financial reality while mourning the loss of a loved one.

Laying out your ultimate intentions — from burial preparations to how you’d like the death benefit to be used — might help your loved ones avoid some of the unpleasant decisions they’ll face after you pass away.

Consult a financial professional to assist you in developing a financial strategy for your beneficiaries. Making a plan for how the death benefit will be used, such as for college tuition or expenses, will assist guarantee that the benefit is being used to protect the people you care about.

1. Affordable premiums: A term insurance plan can provide you with high-value life protection for a low monthly payment of $485*. Premium payments are processed monthly, half-yearly, or annually. The earlier you purchase a term insurance policy, the lower your premium will be.
2. Whole life cover: Term insurance policies provide significantly longer coverage. Whole life insurance policies cover you until you’re 99 years old.
3. Payouts of the sum insured: In the event of the insured person’s untimely death, the members of the family will be paid the sum assured. The policyholder has the option of receiving a lump payment, a monthly or annual income, a mix of lump sum and income, or a rising income at the start of the policy. This will assist with financial necessities, as well as household expenses and other charges.
4. Critical illness coverage: If your term insurance plan includes optional Critical Illness Coverage1, you will receive a lump-sum payment upon detection of any critical illness1 covered by the plan.
5. Accidental Death Benefit – The Accidental Death Benefit can be added to your term insurance policy. This will provide protection against future mishaps.
6. Coverage for Terminal Illnesses – Term insurance policies can provide lump-sum payouts if you are diagnosed with a terminal illness such as AIDS.
7. Tax Benefits – You can receive tax benefits on premiums paid under Section 80C as well as premiums paid for critical condition benefits under Section 80D. Section 10 (10D) of the Income Tax Act, 1961 exempts the lump-sum funds obtained by beneficiaries as the sum assured/death benefit from taxes.