News

Kansas Insurance Department announces service to find lost life, annuity policies

The Kansas Insurance Department (KID) can now assist Kansans in locating life insurance and annuity benefits they may be owed.

The new Life Insurance Policy and Annuity Search is now available by submitting a request form to our department. Kansans who believe they are beneficiaries, an executor or legal representative of a deceased person can request help through KID.

KID will then send the request to all Kansas-licensed life insurance companies to search their records. If a policy or contract is found, the company will respond directly to the requestor to begin the claims process.

We are pleased that we can provide this service. It will enable Kansans who are possible beneficiaries to find benefits from another person’s life insurance or annuity contract. It will eliminate multiple searches by individuals because the insurance department will act as a clearinghouse for those requests.

Those submitting a request will need to do the following:

It is especially appropriate that this service is first offered through our department during Life Insurance Awareness Month. Although this service may benefit those who didn’t know about a person’s policy, Kansans should always consider letting beneficiaries know of a policy’s existence. That can have a great significance for them over the course of a lifetime.

Your beneficiaries will receive the insurance benefits tax free, and life insurance benefits do not have to go through probate or other legal delays involved in settlement of an estate.

You can specify as many beneficiaries as you want to receive the benefits. You may also specify how the benefits are to be divided. It is a good idea to name a second (contingent) beneficiary to receive the money in case your primary beneficiary dies before you do or at the same time as you.

According to law, monthly life insurance or annuity payments will not disqualify the beneficiary from receiving full Social Security payments. Monthly life insurance benefits do not count as earned income, regardless of how much is paid each month through a policy.

As a general rule, your beneficiary does not have to pay any federal income taxes on the proceeds of your policy. However, if proceeds of a policy are paid to the deceased person’s estate, and the total estate exceeds a statutory maximum, including life insurance, there will be federal estate taxes payable. Seek assistance from your insurance agent, lawyer or accountant if you need more information.

We hope that the new locator service will provide an efficient way for previously-unknown beneficiaries to receive undistributed funds. But, we really hope that you as a policyholder notify any beneficiaries so that they don’t need this new service in the future.

 Source: Ken Selzer, CPA, Kansas Insurance Department

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