What Occurs If You Pass Away Immediately After Purchasing Life Insurance?

 Life insurance serves as a financial safety net, providing economic stability to your loved ones in the event of any unfortunate occurrences. But what if the policyholder dies right after buying the online life insurance policy? Can their beneficiaries still claim the insurance benefit? Such questions may arise when considering life insurance.  

 When you buy an online life insurance policy, the provider is contractually obligated to pay the designated death benefit, regardless of when the policyholder passes away - whether it's two months or twenty years after the purchase. Although life insurance is intended to offer coverage in the event of the insured's sudden death, if the policyholder were to pass away within a year or two of acquiring the policy, the insurance provider might seek ways to avoid settling the claim.  

 

This is particularly true if there were inaccuracies or false information on the primary insurance application or if it appears that the policyholder might have committed suicide.  

 

How to Make a Life Insurance Claim?  

Once the first premium payment for the online life insurance policy is made, the timing of the policyholder's death becomes less relevant. Most likely, the coverage will be in effect, and the beneficiary will be entitled to claim the life insurance benefits. However, before making a claim, it is essential to understand the insurance company's provisions regarding the time limit for beneficiaries to make a claim and also consider the following points:  

 

• Obtaining a Death Certificate: After the insured person's demise, the beneficiary must obtain a certified copy of the death certificate, which includes specific details such as the location, date, and time of death, as well as the cause of death. This legal document helps the insurance company verify the cause of death.  

• Contacting the Life Insurance Company: If you are aware of the insurance agent, contact them immediately. Alternatively, you can reach out to the insurance company to initiate the process of claiming the death benefits. If you have no information about the policy, the National Association of Insurance Commissioners (NAIC) provides a locator service to help you find the insurance company. Sometimes, the company might also try to contact you, but it can take time for them to realize that the policyholder has passed away.  

• Filling Out the Death Claim Form: Ultimately, the insurance company will require the beneficiary to fill out a death claim form. If no death claim is filed, there will be no benefits. Therefore, to receive the insurance claim, it is crucial to promptly complete the specified form to receive the death benefits.  

• Waiting for the Insurance Company's Review: Typically, the life insurance company may take up to 30 days to review a claim. Once the review process is completed and all the necessary documents are verified, the insurer will decide whether to settle or deny the claim.  

 

Two Reasons Why Your Online Life Insurance May Not Pay Out  

Here are some reasons why life insurance might not pay out if the policyholder dies right after purchasing the policy:  

• Incorrect Disclosure of Medical Records: If the policyholder passes away within the waiting period (the initial period post purchasing the life insurance), the insurance company has the right to scrutinize their medical records. The company can conduct a thorough examination of the policyholder's medical history and other information provided during the application process. If any medical information was omitted or inaccurately disclosed, the insurance company has the right to deny the claim or reduce the death benefit.  

• Suicide Clause: The suicide clause in a life insurance policy stipulates that if the policyholder commits suicide within the contestability period, the insurance company has the right to reject the beneficiaries' claim.  

  

By choosing life insurance, you can protect your family and provide them with the full value of your hard-earned savings in the event of your unfortunate demise. So why wait? Get a life insurance policy today.