According to an online survey of 805 life insurance policyholders across the United States, the majority (70%) of them are confident their beneficiaries would know how to file a claim. In fact, most have taken proactive steps to help them prepare.
Nationwide Financial Services Inc. released the Harris Interactive-conducted survey in time for Life Insurance Awareness Month (September). Many of the respondents (84%) say they've talked with their beneficiaries about the policy. Most talked about the face value of the policy (53%), who the beneficiaries are (47%), and who the life insurance agent is (20%). And, 91% of policyholders say their beneficiaries are aware of being designated on the policy.
Peter Golato, SVP of Individual Protection for Nationwide Financial, points to Life Awareness Month as a good opportunity for policyholders to review their policy with their agent or adviser and beneficiaries. "Though most policyholders have done a good job of preparing their beneficiaries, there are some who need to take additional action to ensure their policies are kept updated so that, when the time comes, benefits due are paid in a timely manner," says Golato.
The survey finds that one in five policyholders have not provided their insurer with up to date contact information for their beneficiaries. More than half (55%) of policyholders did not change their beneficiary after divorce. And 57% who have talked with their beneficiaries about the policy have not told beneficiaries where the policy is located.
"According to the survey, 75% of policyholders have not changed the beneficiaries designated on their policy and among those who did make changes, 77% did so five or more years ago," says Golato. The major catalysts for a change of beneficiary were getting married (30%), having a baby (21%), getting divorced (19%) and the death of a beneficiary (18%).
The top five reasons that policyholders purchased life insurance were: no particular reason (30%), started a new job (29%), got married (16%), had a baby (12%) and bought a house (10%).
Carrie Burns writes for Insurance Networking News, a SourceMedia publication.
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