Nearly 90,000 people nationwide are sharing a bounty of $665.7 million in life insurance proceeds that were previously unknown to beneficiaries.

New York’s Department of Financial Services (DFS) discovered the unclaimed benefits as a result of an investigation started in 2011 that has to date resulted in 89,171payments made to beneficiaries across the U.S.

The investigation focused on life insurance companies that did not regularly seek out beneficiaries to pay death benefits, but instead waited for claims to be made. According to DFS, many people are unaware they are named on life insurance policies by relatives.

Andrew Cuomo

DFS instituted new regulations in 2012 – later signed into law by Gov. Andrew M. Cuomo – requiring insurers to conduct beneficiary searches at least quarterly.

In the state of New York alone, 18,597 payments were made totaling $206.2 million. The remaining $459.5 million was distributed to more than 70,000 people nationwide.

“It is only fair for families and individuals who lost loved ones to receive the life insurance benefits to which they are entitled,” Cuomo said in a statement. “Life insurers are now responsible for proactively identifying policyholder deaths and are making good faith efforts to find people so hundreds of millions of dollars in unclaimed benefits can be paid.”

Life insurance companies writing policies in New York must now search the federal “Death Master File” managed by the Social Security Administration to identify policyholder deaths and cross-check that data against active and terminated policies for which no claims had been made.

Access New York’s “Lost Policy Finder” portal.

See also:

Insurers should dig deeper for life policyholders’ beneficiaries