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Scenarios that may lead to unclaimed benefits

Posted On Wed, May 18, 2011

Life insurance is purchased for a number of reasons, but it's bought because policyholders want to make sure their loved ones are financially protected should they die. But as the Insurance Information Institute indicates, beneficiaries occasionally don't receive all that's owed to them.

To make sure benefits don't go unclaimed, the III recently listed several unclaimed benefits scenarios and what people can do to make sure it doesn't happen to them.

For instance, the III says sometimes beneficiaries may not know they are due to receive money after a loved one's death. Thus, III indicates that policyholders should be sure to inform those who are beneficiaries that they are listed on their life insurance and that they know how to get in touch with the insurer.

III states sometimes the insurer can't get in touch with the beneficiary because the person has moved. This can be avoided, however, by making sure the life insurance company has all of the beneficiary's information just as soon as he or she relocates.

Unclaimed funds can cost beneficiaries while policyholders are still alive, as some purchase life insurance to help fund their children or grandchildren's college education. 

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