Unclaimed Life Insurance policies

By Thomas Tuke

The largest non-government holder of unclaimed money is Life Insurance companies. Almost 30% of all life insurance benefits in excess of $500,000,000 go unpaid or unclaimed upon the death of the policyholder. Family members don’t notify the insurance company simply because they not aware the deceased person might have had more than one policy. As a result, life insurance companies become separated from their policyholders and the beneficiaries- usually because they have not been notified of name or address change.
Also many states do not presume abandonment of life insurance policies until the insured policyholder would have reached the age of over 100 years. As a result, this type of unclaimed assets may not show up in a government database for some time.

It is the responsibility of the beneficiary to contact the life insurance company and there is no central database to search such. Also, mattering on the type of policy – whole life or term policy, there could be a residual value even if the policy was canceled or not paid-up.

Another source of unclaimed money or assets with life insurance companies has been the recent demutualization of some of the largest insurance companies. Demutualization refers to a reorganization in which a mutual insurance company becomes a stock company. This is accomplished through the payment of stock or cash to the policyholders upon the discontinuation of the mutual company. This reorganization has no impact on the actual life insurance policy.

After demutualization, shareholders of the new company entitles them to vote at shareholder meetings and to dividends declared on their shares. The new shares are listed on a major stock exchange. This provides for the potential to raise capital by having new investors buy the stock while providing a market for the policyholders to sell their shares.
The amount due each policyholder is based on a number of factors, including length of time the policy has been in force, face value of their policy, and total premiums paid. For many policyholders, this windfall arising from demutualization can be substantial, and the financial benefits continue after the company demutualizes.

Between 1985 and 2004, more than 20 major insurance companies went through demutualization. See list – Unfortunately, millions of policyholders’ current addresses were not known by these major insurance companies and the policyholders were not informed that they now owned stock in a new company in addition to their actual life insurance policy.

If you or a deceased relative had a life insurance policy with any of the below companies, you may be entitled to either stock and cash dividends as well as the proceeds of the policy itself. If the policyholder cannot be found, the demutualization proceeds are turned over to a State agency after the statutory period which varies from state to state (but normally a one to three year period) has passed. There is no time limit by which these proceeds can be recovered, however it is possible that stock could be sold by the government agency and any appreciation or dividends after time of sale would be lost.

If you believe a deceased relative had a policy and payment has not been received or had a policy with a life insurance company that demutualized initiate an unclaimed asset search and contact the life insurance company directly.

Thomas Tuke is the CEO of American Refund Services Inc. Valuable services as http://www.US-UnclaimedMoney.com and http://www.Unclaimed-Databases.com assist individuals in locating unclaimed or lost property WITHOUT paying up to a 25%+ Finders Fee.

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