In honor of National Life Insurance Awareness Month, Nationwide Financial Services conducted a survey to gauge the confidence level most policyholders have in their beneficiaries to properly handle matters in the event of their death. The survey found 70 percent of holders believe their beneficiaries would know how to file a claim, and many have taken steps to prepare them for the procedure.
According to the data, 84 percent of respondents said they have talked to their beneficiaries about the policy, including the face value of the policy, who the beneficiaries are and who the life insurance agent is. In addition, 91 percent of policyholders say their beneficiaries are aware of being designated on the policy.
Peter Golato, senior vice president of individual protection for Nationwide Financial, said policyholders must keep beneficiaries abreast of policy options and changes, as well as check in with insurance providers to make sure all information has been updated.
Golato said 20 percent of policyholders have not updated their information with their provider, and 57 percent of owners who have talked with beneficiaries about the policy have not told them where the policy is located.
Even Bernard Madoff can fail to properly prepare his beneficiaries for how to handle funds. Bloomberg recently reported that New York Life Insurance and six other insurance providers are accusing Tremont Group Holdings and the trustee Irving Picard of treating funds unequally. Despite the Madoff case being closed for some time, it was not clearly established as to how the funds would be distributed, so the trustee and insurers have taken the matter to court.