The emotional impact of a loved one’s passing is profound. Many individuals seek to understand how life insurance will be distributed to beneficiaries after their demise, to ensure their loved ones are informed and prepared. It’s equally important for beneficiaries to understand the process.
Beneficiary Disbursement
Typically, individuals with a life insurance policy specify their beneficiaries while they are still alive. This usually involves providing the beneficiary’s name, birth date, and social security number. Payments can also be directed to a business or another entity, such as a trust.
Upon the policyholder’s death, a claim is usually filed with the insurance company in Niles, OH, that holds the policy. The company may require proof of death before disbursing the funds. Once approved, the beneficiaries receive the policy’s cash value. Some companies directly deposit the money into a bank account for the beneficiaries, who can then withdraw the cash immediately.
Potential Delays in Insurance Policies
Certain circumstances can delay the receipt of life insurance payments. For instance, if there is a suspected murder or suicide, many insurance companies will investigate the situation to ensure that the beneficiary did not cause the policyholder’s death to obtain the life insurance. However, such scenarios are not common at Ruddy Insurance Group.
Funeral Expenses
Beneficiaries in Niles, OH, can use their life insurance benefits as they see fit. Many choose to cover funeral costs. However, the life insurance payment may not be disbursed before the funeral. Fortunately, many funeral homes are willing to work with beneficiaries. They often require proof of the policy and signed legal documents, allowing the insurance company to pay the funeral home first and then disburse the remaining funds to the beneficiaries.
Understanding the intricacies of life insurance is vital to ensuring you’re comfortable with how the funds are used. Contact the agents at Ruddy Insurance Group today to learn more.
