Four Ways to a Claim Life Insurance Payout

When you pass away, life insurance payouts are sent to the beneficiaries listed on the policy. All beneficiaries have to do is file a claim to collect the death benefits. Claims are typically processed right away, as long as the claim form and death certificate are completed.

Beneficiaries choose how to receive the death benefit, in one of these four ways:

• The first type of life insurance payout is a lump-sum fixed amount. This option allows beneficiaries to receive the death benefits in one payment. Be careful on where you send the funds. If you send to a bank account, FDIC only insures up to a certain amount.
• Specific income payout. Beneficiaries choose monthly installments over a set period of time. For example, death benefit is $600,000, you could request $30,000 in payments each year over a 20 year period.
• Retained asset account. This option allows beneficiaries to have the death benefit placed in an interest-bearing account. This account can then be used to access cash and the interest earned is taxable. The insurance company will guarantee the funds in the account, even if the balance exceeds the limit set forth by the FDIC.
• Annuity. Also called life income payout. Beneficiaries are guaranteed payments as long as they are alive. Payment amounts are determined by amount of the death benefit and the beneficiaries age when the life insurance is filed. Unless the beneficiary designates a beneficiary upon their death, any remaining dollars will go back to the insurance company.

Life insurance payouts are there to give your loved ones a sense of security and peace of mind when you pass away. It can help cover final expenses, like funeral costs and any outstanding debts; as well as caring for loved ones.

To find out more about life insurance payouts, Call Advanced Insurance Concepts today and Jim Rooney will work with you to find the answer. Advanced Insurance Concepts works with a variety of insurance companies and all Medicare Advantage providers in Missouri and Kansas. He is licensed to sell Health, Life and Accident Insurance, so call Jim Rooney for all your insurance needs.