If you are here, then you must know that the main reason to get a life insurance policy is to use it as a form of protection for your loved ones if someday in the near or distant future you happen to pass away.
Getting life insurance in Ohio should not suppose a problem if you gather enough information before starting to file it.
Before getting to the main point of the article, it is necessary to explain some vital information first. The person who receives the money is the beneficiary, and you can name whoever you want in the form. You are also able to make changes if you believe it’s necessary.
This being said, the beneficiary is the person who will receive the benefit once the insured person passes away.
The total amount to be received varies depending on how many beneficiaries exist in the document.
If your name is the only one that appears, you will receive the total amount of insurance, however, if there are other people named as beneficiaries as well, then you will receive an amount equal to the one stated in the policy.
Starting to file a life insurance claim isn’t complicated at all, but we recommend getting assistance from a professional in the matter.
However, you should keep in mind that once the policyholder physically disappears, you can request the death certificate. You can find more information about how to file a life insurance claim in Ohio in this article.
Now that you know the most basic information, let’s get to know in more detail how does a life insurance payout work in Ohio.
Get to know what your current situation as a beneficiary is
There are many rules to apply when it comes to beneficiaries. First of all, as mentioned above, after getting the life insurance policy, the policyholder can designate a beneficiary or multiple ones, and they will receive the money once the policyholder dies.
There’s also the possibility of naming a contingent beneficiary, in other words, they will become the secondary beneficiary, which means that in case the primary beneficiaries pass away before they get to claim the insurance, they can do it.
As with the primary ones, you can name multiple contingent beneficiaries.
People you have designated will receive the total amount of insurance stated in the policy. If there are multiple beneficiaries, the policyholder has the power to state how much money each individual will receive.
One of the policyholder’s responsibilities is to let know the beneficiaries that they have been chosen for the benefit, if multiple ones exist, and if contingent beneficiaries are also stated in the policy.
There’s a lot of information that must be handled, and people who aren’t able to research by their means should request assistance either from a loved one or from a professional. However, once they have started filing the life insurance claim, assistance from a proper insurer is necessary.
Getting the death certificate
As a beneficiary, one of your duties is to start filing the death certificate with assistance from the funerary or crematory company you’re requesting services from. It should be done in the same state where the policyholder died, and in Ohio, some fees apply, and they are different depending on the county you’re currently living in.
The death certificate is the document that holds the most vital importance during life insurance proceedings. This document will be requested by the life insurance company the policyholder made a contract with, and it just one of the requirements for starting to file a life insurance claim in Ohio.
Some rules are meant to give more benefits to the beneficiary, depending on the cause of death. Remember, the cause of death is required in the death certificate in Ohio, and that part of the document should be filled by the medical examiner under that jurisdiction.
Let’s say that the policyholder dies in a car accident. An investigation will begin, and depending on whether the accident happened by the person’s fault or just partially, you will receive a different amount of money; for the first case, the amount will be doubled.
Each life insurance company in Ohio is different, and they apply rules of its own. Most of the information regarding the benefits that will be given to the beneficiary can be found on the policy, and in most cases, they are stated by the policyholder.
Remember, if the cause of death is explained properly, it is very likely that the company won’t start an investigation regarding the circumstances of the policyholder’s death.
During the investigation, they may require some other documents that you should be able to get, for example, medical reports. The documents required are different, as each case is handled sharply.
This is of great importance, because, if certain conditions are reunited, the payment can be denied. Just to give you an idea of the cases where this is most likely to happen, let’s say that the policyholder that designated you as a beneficiary happened to die while being involved in a crime. If the investigation is handled properly and the problem is finally brought to light, you will not be able to get the insurance money.
Keep in mind that these proceedings usually take some time. Once you know the policyholder’s death, you should contact the company they made a contract with to start filing the life insurance claim. Again, remember to gather as many copies of the death corticated as you can, as it will be necessary for many of the processes that follow you loved one’s death.
These processes can take up to 2 months to be completed, however, the timeframe can become longer if the proper documents aren’t retrieved to the insurance company. We encourage you to gather all the documentation necessary, and you can find out what you need to start filing a life insurance claim in Ohio here.
What you should know about the life insurance payout contestability period in Ohio
Before starting to file a life insurance claim, there is some information that you should consider. In this section, we are going to explain how the two-year contestability period works in Ohio. This rule applies in most companies to avoid fraud (perhaps you have seen how it is committed in many of those popular TV shows that people enjoy). You must know what this period is all about:
The insurance company can delay the payment if the policyholder passes away within that time frame. Let’s give you an example: if the insured happens to die two or three months after the policy process has been completed, then the beneficiaries must wait until the two years pass to start filing the claim.
In the meantime, you can start planning how you are going to handle that proceeding and work towards healing your grief.
Some companies also consider suicide for this rule. For example: if the insured happens to die by suicide during the first six months that the life insurance policy has been filed, then the company isn’t obligated in any way to pay the designated beneficiaries the total amount of insurance.
The Payout Itself
Just as it takes a lot of time to finally let the grief over a loved one’s death go, these proceedings take a lot of time to be completed.
You’d be surprised if you saw the large number of people that commit fraud every year, and this is just one of the ways that companies have to make sure that the designated beneficiaries deserve to claim the benefit.
The total amount of money will be retained by the company until the circumstances that revolve around the policyholder’s death are cleared.
If that’s not the case, you might not be able to claim the insurance money; however, they will notify you when a decision has been finally made. If the results are positive, you will be able to receive the money within a time frame of 45.
You will be notified about when you can receive the insurance benefit
In other articles (and even in this one), we have told you about what is the situation regarding the beneficiaries. Unless they are minors, anyone who is a designated beneficiary can receive the life insurance any time after the two-year time frame has been reached.
In the case of kids being named as beneficiary, the policyholder should have named a responsible adult to receive and manage the income for them until they have reached the legal age.
Now that we’ve reached this point, let’s talk about how you can receive the income after the process has been completed. It isn’t complicated at all, and you can choose the option that suits you better, depending on what the company offers to you as well:
- The most common way of getting the income is by requesting it in a single payment.
- You can choose to receive a percentage of the total amount every year. Interest may be earned by the heir while the insurance company still holds it.
- You can also request a straight life income. This way, the beneficiary will receive payments throughout their life. You can choose how and when to receive the payment.
- The previous way of receiving the insurance money has a catch: if the beneficiary happens to die before the insurance money is paid completely, then the company will keep the rest of it. You can avoid that from happening by setting a time frame from where you’d like to receive the payments, for example, 5 years. This benefits the contingent as well: if the primary beneficiary dies, they will keep receiving the payments.
- Another way is to let the company calculate a “Joint Life with Survivorship”, and you can set the conditions of it as you can do with the previous one.
- Finally, you can receive the interest that the total amount generates while the company keeps it.
Now, you are aware of those who can receive the benefit, how they can receive and how low the process takes to be completed.
Companies work this way to avoid those who commit fraud. One thing you can be sure of is that you will be able to receive the money once the proper documents have been retrieved to the company and the proceedings have been completed!
You should also be aware that in case an investigation surrounding the policyholder’s death has been started by the insurance company, you will not be able to receive the benefit until the investigation is over.
This process can take from weeks to years to complete, but if everything is okay, you can be sure that you’ll be getting your insurance benefit.
During the first months after the loss of a loved one, you might require support from those who are close to you. This is the only way that you’ll be able to be over this hard time.
You need to be patient with yourself, and while doing the procedures, you should take your time so you don’t overwhelm yourself.
Remember to put your health first, as grief can affect and hurt people deeply. If you think you can’t handle these moments on your own, talk to someone close to you and keep them near, in case you require a shoulder to cry on.
The information given in this article is all you need to know about how does a life insurance payout work in Ohio. This resource has been made for educational purposes, and we encourage you to request assistance from a professional if you still have doubts about the matter.