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To understand more about how death benefit checks are paid out, we sat down with one of our insurance specialists, Jerry Angel, and asked him his thoughts. To hear answers directly from an expert, watch the video below or read the following article summary.
Death Benefit Check Timeline
The amount of time it takes for a beneficiary to receive a death benefit check can vary greatly. Death benefit checks come from the life insurance company and are based on several factors. One factor is that the insurance company needs to process the claim, and official information about the insured’s death needs to be provided. For example, the insurance company may ask for a death certificate to finish processing the claim, and death certificates can take a while to draw up. You are dealing with another party – the county or the state – to issue that death certificate, and they operate on a different schedule.
The insurance company looks at the death certificate and processes that death benefit based on the terms of the policy itself. For instance, the insurance company has the right to investigate the claim and conduct an in-depth analysis of the insured’s policy terms and the last few years of their life. They can delay the payout and take time to look at anything and everything that has happened within the previous two years.
Let’s say I bought a life insurance policy a year and two months ago. Then, I passed away from an illness. Consequently, they can look to see why I died, review doctor records, and everything else to make sure I told the truth about my health when I applied. That’s two years– a two-year look back– and insurance companies have that right.
Life Insurance Policy Challenges
So, in some cases, it can take a little while to dig through everything. It’s called a challenge or “challenge period.” Insurance companies may not challenge the legitimacy of the policy, but they will investigate. After the challenge period (two years maximum), the death benefit is paid much more quickly. Insurance companies can’t go back and challenge anything at that point. Challenges have a two-year time limit, and that’s the way it is with all policies. So, the death benefit can come fairly quickly if everything lines up fast. If the death certificate is received, and there is no challenge period, it can arrive within a couple of weeks.
Can a Death Benefit Check Be Denied After the Challenge Period Is Up?
No, after two years, insurance companies must pay that death benefit check (unless they find a reason to nullify the policy in their investigation). If it takes a full two years of searching to determine whether the claim is legitimate, they must pay at the end of those two years.
For example, a personal friend of mine (with whom I wrote a life insurance policy) fell into a lake, hit his head, and that’s where he passed away. Rather than issue the death benefit check, no questions asked, his insurance company went ahead and looked to see why he fell. In other words, they wanted to see if there was some health reason he did not divulge during the application process that could have caused his fall. If he’d lied, they could have denied paying the death benefit. However, they didn’t find anything, and therefore, the claim was paid as quickly as possible after they came to that conclusion. Their investigation ended within those two years. So that type of situation can happen, but most of the time, it runs pretty smoothly.
However, there are a few other reasons why a death benefit could be denied within the challenge period. A policy can be nullified for more reasons than having a dishonest application. If you’d like to read more, Aflac has compiled an easy-to-understand list of reasons for claim denial.
Life Insurance Questions?
We hope that this information on death benefit checks has been useful to you.
If you’d like to learn how we can help you plan your retirement, call Empower Brokerage at (888) 539-1633 to speak to one of our Life and Annuity experts or leave a comment down below.
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Article updated on 3/29/24.
My mom died of a massive stroke in March 2019 and her life insurance policy went into effect in June 2017. I am a beneficiary on her life insurance policy, and I turned in my claim for the life insurance benefits in May 2019, but it is now July 2019 and the life insurance company is still investigating her death and I havent received any money yet. How long will it take to investigate her death?
Patrice, first let me say how sorry we are to hear of your mom’s passing. I understand how hard that is to deal with and to navigate all of the arrangements.
Normally a claim doesn’t take longer than 60 days and can happen in a little as 10 to 14 days. It could delay the process since you didn’t file the claim right away.
You should contact the claims department to find out a status or if they need any additional information. There could just be an error or missing item.
I suspect it’s just taking longer than average and that it should be resolved soon. I would call the claims department because they will know for sure.