How long does life insurance take to pay out?

If you own life insurance, or are the beneficiary of a policy, we understand that you'll want the funds to be distributed as quickly as possible after a claim is made. However, it's not always as simple as it seems. There are other factors you need to be aware of that could delay a claim.

In this article, we'll look at the typical timeframe for life insurance payouts, the factors that can influence this timeline, and what beneficiaries can do to make the claims process smoother.

They will then decide whether to accept the claim after checking that the ppolicy holder's death meets the terms and conditions of the policy. Typically, once a valid claim is submitted, most insurers aim to process it within 30 to 60 days. However, there are instances where the payout may take longer.

Not sure if your loved one had life insurance? Check out our guide on how to check if someone had a life insurance policy.

When could a payout be delayed?

Due to the nature of life insurance policies, there are several reasons why a payout might take longer to process, such as if:

• Details are missing from the claim submission
   

• The cause of death requires further investigation (e.g., if it was due to an accident or involved a suspicious circumstance)
   

• The insurer needs to verify that the policy was in force at the time of death
   

• There are outstanding premiums or issues with payments on the policy
   

• The beneficiary's identity or relationship with the policyholder cannot be confirmed
   

• Involvement of any legal proceedings

As life insurance pays out for natural deaths (i.e. accidents, old age, illnesses etc.), the process may take longer if there are any complications or uncertainties regarding the cause of death. There may be other circumstances where the insurer is waiting for information from third parties, such as doctors or GPs, before they can complete their assessment.

How long after death can a claim be made?

Life insurance claims do not have an expiry date and can be claimed at any time. However, typically, the insurer will hold the policy for up to two years after being informed of the policyholder's death, during which time they will assess and handle the claim accordingly.

What can you do to speed up the process?

While some factors are beyond your control, there are a few steps you can take to help make the claims process easier:

1. Gather documents early: As soon as possible after the policyholder's death, collect all the necessary documents such as the death certificate, policy number, and any other information that may be needed about the deceased.
    
2. Check that the policy is active: Before submitting a claim, ensure that the life insurance policy is in effect at the time of death. If they had a term policy, make sure the policy was still active and that all premiums were up-to-date.
3. Contact the insurer promptly: Contact the insurance company as soon as you have the required documents. While it may be difficult as you grieve, the sooner you initiate the claims process, the quicker it can move forward.
    
4. Be prepared for additional questions: Sometimes insurers may need more evidence or regarding the claim. Being prepared to provide any other information can help complete the process.

If you have any questions regarding making a life insurance claim or the payout process, feel free to contact Cavendish Online. Our advisers will be happy to talk you through the process and provide guidance based on your situation.