Life Insurance Quotes

MetLife finds $135,000 in Social Security death database

10/07/11

According to the Wall Street Journal, MetLife recently announced an investigation into several federal death databases has yielded information that the company says will add up to $135 million in expenses owed to deceased policyholders.

Under pressure from federal legislators to more regularly identify deceased policyholders who had not received payouts, Metlife trolled a number of federal databases, including the U.S. Social Security Administration's Death Master File, to identify policyholders who had died, but from whom no claim was filed. Most life insurance contracts place the onus of payout on the policyholder, who must file a claim to receive money.

While on the surface the value of the unpaid claims was alarming, officials at MetLife told the source that the estimated expenses account for only about 1.2 percent of the company's annual life insurance expenses.

State and federal officials say that while contractually the policyholder is required to report claims, improvements to government death databases make monitoring practices on the part of the insurer economically feasible, and life insurance providers should now share in the responsibility.

According to the Insurance Information Institute, in 2010, just one in three Americans owned an individual insurance policy, the lowest number in half a century.

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