You may be among the thousands of people owed money from a life insurance policy that a relative left you. Regulators believe there are millions of dollars not paid to beneficiaries.
Many states are now taking action to get the money distributed. But as Local 12 Troubleshooter Howard Ain explains, in Ohio,o you may never get money owed to you.
When a loved one dies and they leave a life insurance policy, it's been the practice that the beneficiary has to file a claim to get the money. but what happens if you're unaware of the policy? Tens of thousands of people have not filed for the funds-so many that it's estimated life insurance companies may have been holding on to about one billion dollars.
Ohio Attorney General Mike Dewine says he understands how this could happen."There may be a policy here, a policy there and frankly sometimes even people forget these policies you know, they pay them up and they're not paying on them anymore and they're just sitting there and they forget about them."
Insurance companies, including Cincinnati-based Western and Southern Life, are being sued for failing to notify beneficiaries of money that's owed. An 85-year-old Ohio woman is suing to force two units of Western and Southern Life to start searching the Social Security Master Death List for policy holders and alert beneficiaries. It's not like the companies are unfamiliar with the master death list-- most insurance companies use it so they can stop making annuity payments to those who die.
Kentucky solved the payout problem earlier this month when the governor signed legislation requiring insurance companies to notify beneficiaries. State Representative Arnold Simpson of Covington co- sponsored the legislation. "In New York they have recovered millions of dollars of policies already and that's relatively new so we expect that its going to result in policyholders throughout Kentucky recovering monies that but for this legislation they would have no knowledge of."
In fact, Howard's twin brother Stewart, who lives in New York, says he's learned many insurance companies there are now combing the national death records. "Almost a half million people are still going to be getting letters saying hey folks you may have been a beneficiary and you never knew about it."
One of those people who just got a check, with interest is Stewart's wife Meryl, whose aunt died in 2002. "My aunt who did not have a lot of money but who wanted to make this gesture later in her life, took out a policy and nobody knew about it and they held it for 10 years. it's not their money."
In the Tri-State, Ohio is the only state not requiring insurance companies to notify beneficiaries when life insurance policies come due. "That's certainly something I think in Ohio the state legislature could look at and its certainly something that ought to be discussed because it's a problem."
In response to our questions, Western and Southern Financial Group sent us a statement saying it "Adheres to the letter and spirit of all laws and regulations pertaining to unclaimed life insurance benefits. We take our responsibility seriously and have every legal, ethical and business incentive to honor our contracts with policyholders."
You may remember, last Monday, we told you that Metlife settled a suit agreeing to pay nearly $500 million in life insurance benefits. That settlement involves in 30 states.
Butler County Prosecutor Mike Gmoser has a warning, though. Be wary of anyone who contacts you out of the blue, claiming that you have insurance money owed to you. In particular, Gmoser says you will not need to pay any fees or fines to get a legitimate insurance settlement.