Life insurance claims

A life insurance claim represents a formal request by beneficiaries (such as spouses, children) to an insurer (such as Prudential, MetLife) for payment upon the policyholder’s death. Beneficiaries submit documentation (such as a death certificate, policy details) to prove eligibility for payout.

Insurers process claims within timeframes established by state law; in California, insurers must respond within 40 days. Typical payout periods range from two weeks to 60 days, according to NAIC data.

Common claim denials occur due to non-payment of premiums or material misrepresentation on applications, per Insurance Information Institute statistics. Required documents for claims include certified death certificates and completed claim forms, based on requirements set by providers like State Farm and New York Life.

Insurers may contest claims during a two-year contestability period if fraud or nondisclosure is suspected, as outlined in nearly all U.S. Policies.

Some policies pay interest on delayed claims; for example, Texas mandates interest after 15 days of delay, from documentation provided by YourInsurance.info. Payout methods include lump sum payments or installments, with over 90% of beneficiaries choosing lump sums per LIMRA studies.

Suicide clauses often exclude coverage if death occurs within two years of policy inception; almost all major carriers enforce this rule. Partial payouts only occur if riders–such as accelerated death benefits–apply, per evidence from companies like Lincoln Financial and AIG.