Tracking Down and Collecting Unclaimed Life Insurance

THE most basic purpose of having a life insurance policy is to provide some assistance for loved ones when you die. Wealthier people sometimes use life insurance for estate planning, while most people expect the policies on which they have paid premiums for decades to help their heirs get by — or at the least cover funeral expenses.

Yet hundreds of millions of dollars in life insurance goes unclaimed each year for one simple reason: the beneficiaries do not know the money exists. Even in this wired age, if the insurance company cannot locate the beneficiary — or for that matter, even learn that the policyholder has died — that money will go unclaimed.

The money does not stay with the insurer indefinitely. It is eventually transferred to state unclaimed property divisions. And the states then post the information on Web sites or in local newspapers.

But that process can take years, and in the meantime, first the insurers and then the states profit from money owed to the beneficiaries.

Florida has about 9.9 million unclaimed accounts — including securities and other property, in addition to insurance — worth more than $1 billion. Of that, some $355 million is related to unclaimed insurance, said Alexis Lambert, a spokeswoman for the Florida Department of Financial Services.

http://www.nytimes.com/2011/02/26/your-money/life-and-disability-insurance/26wealth.html?_r=1&ref=your-money