October 30, 2015
According to ConsumerReports.org, there are at least $1 billion in benefits in life insurance policies still waiting to be claimed. The average unclaimed benefit is about $2,000. In addition to other state unclaimed property, unclaimed life insurance benefits have typically fallen under the same guidelines – The Uniform Unclaimed Property Act.
The UUPA helps states deal with unclaimed intangible property – stocks, bank accounts, etc. – and helps determine when a piece of intangible property is considered abandoned, thereby figuring out how to determine the rightful beneficiary and transfer ownership. What the UUPA doesn’t address is to what extent the state (or in this case, the insurance company) needs to locate the beneficiary.
The National Association of Insurance Commissioners recently updated an article* on their site that talks more in-depth on the issue of unclaimed life insurance benefits and the challenge of creating some consistency on the state level.
As the article explains, there are a few state legislatures that will start requiring life insurance companies to not only use a database to determine if a policy holder has died, but also be required to attempt to locate beneficiaries. The article specifically mentions the Death Master File as a possible database that insurance companies could use and search as a means of data verification.
The Death Master File is a contested tool that is the center of an access and validity debate (a debate that at this time, unfortunately, doesn’t look to ending anytime soon). While LifeStatus360 certainly uses the DMF as one of its data sources, it is not, in our opinion, a reliable enough data source on its own.
Because LifeStatus360 uses a number of sources, including a proprietary tool, we ensure that the insurance industry has access to the best and most reliable data available. Utilizing the relational facet of fuzzy logic, LifeStatus360 produces a resulting Q-factor™ scores that provides a logical and rich view of what is happening with customers’ data. We have developed better technology to manage, process, present and secure our customers’ data.
For more information about LifeStatus360’s technology, contact Chris Scaramastra at ChrisS@LifeStatus360.com.
*National Association of Insurance Commissioners, Unclaimed Life Insurance Benefits, Updated September 24, 2015, http://www.naic.org/cipr_topics/topic_unclaimed_life_insurance_benefits.htm