Providing life insurance to your loved ones is great but lost insurance policies cause additional heartache
It happens all too often. Insurance documentation from years ago may have been misplaced or lost causing heartache or difficulty for you, a loved or an executor.To make matters worse, tracking down an insurance policy is made more difficult by the number of changes that have taken place in the Canadian Insurance industry over the years. A multitude of mergers, takeovers & name changes has occurred and will continue to occur.
Here’s a list of many of the Insurance company mergers and name changes that best emphasizes that point:
Looking in the usual places for policy information makes sense like safety deposit boxes or filing cabinets. Contacting known professional advisors (beyond just an insurance agent) is a good thing to do in case they have copies of such documents. Employers or previous employers as well as pension administrators or membership directors of professional associations would be aware of group policies that often times individuals don’t think to make note of. The same would apply to any insurance that an individual might have purchased by way of their credit card issuer.
Beyond that…If you need some assistance in tracking down a life insurance policy, the OmbudService for Life & Health Insurance (OLHI) may be able to assist. The OLHI is a national independent complaint resolution and information service for consumers of Canadian life and health insurance products and services, including life, disability, employee health benefits, travel, and insurance investment products such as annuities and segregated funds.
Safeguarding insurance information & documentation is key but sharing that information with beneficiaries and loved ones is also critical. There is no obligation on the part of insurers to come looking for beneficiaries at any point.
Experts estimate that some 20-30% of insurance policies go unclaimed.
Billion dollar lawsuits are still ongoing in the US where each state requires unclaimed policies to be transferred to the state for safekeeping and inclusion in their open database of unclaimed financial assets. That’s an essential part of Unclaimed Property Legislation that only 2 provinces enjoy currently in Canada.
The OLHI may be of some help but before a policy search for possible insurance coverage on a deceased’s life can take place, 2 requirements must exist:
- There must be a reasonable basis for a search-basic evidence must exist to support the fact that some unlocated coverage does exist.
- Specific factual data about the deceased must be made available.
This kind of search will not uncover contracts acquired outside of Canada, nor will it uncover coverage obtained under employer group contracts. We understand that approximately 22% of those who have requested a search for a lost life insurance policy via the OLHI have found one.
The OLHI also provides tips for conducting your own search. However, it’s really unfortunate that unlike many other developed countries, the majority of Canada does not have Unclaimed Property Legislation in place which would also provide an online searchable database.
Our good friend Michael Hartmann has been a life insurance agent for over 10 years and recognized the problem of lost insurance policies over 6 years ago when his own father did without sharing all of the information on his policies. Michael went to work and established http://www.findyourpolicy.com .
FindYourPolicy offers a secure online insurance registry where insurance policy information can be secured for free. The charge for searching is less than $20. Michael indicates that the average insurance policy is approximately $120,000.
Spending hard-earned after tax income on an insurance policy for the benefit of someone you care about makes safeguarding & sharing your policy information a worthy ToDo. No one can secure this information as well as you can. Please do it.
Our LegacyTracker financial organizing tool provides the ability to organize, safeguard and share your important information and documents like life insurance policies, with loved ones or beneficiaries, executors or advisors.