The amount of unclaimed money seems to be increasing by every passing year. A huge chunk of money is lying unclaimed with Insurance companies. Best Financial Adviser Kuber Mindz Moneymindz says that this is a serious situation where there is a 25% increase of unclaimed money annually.
Why does this happen?
As individuals grow older and/or move to other locations, they have a tendency to lose track of insurance policies. Term Insurance Plans expire when their tenure is over but Life Insurance Plans add up and remain regardless of whether the policy holder remembers or forgets. Smart Financial Adviser Kuber Mindz says that when the insured person passes away, the beneficiaries who are supposed to claim the insurance amount won’t have any idea about this in the first place, resulting in the insurance amount staying with the Insurance Company.
What happens to the unclaimed amount?
Even if the insurance company somehow finds out that insured person died, it’s difficult to track down the beneficiaries. It is a Herculean task to track down people, let alone during such scenarios.
Unclaimed money is sent to the government to promote schemes for the welfare of Senior Citizens in line with the National Policy on Older People and the National Policy on Senior Citizens.
But why do claims go unclaimed in the first place?
There are a number of reasons for claims going unclaimed. Upon digging further, this is what we find:-
Nominee isn’t aware that he/she is the beneficiary
True, at times even the beneficiaries will not know that they have been chosen as the nominee for Insurance amount. At times, even if the beneficiary knows that he/she is the named nominee, the necessary documents might not be available to him/her to claim the amount and prove that he/she is the named nominee. Prevent this from happening, make sure the named nominee is aware that he/she is the beneficiary and that can the documents are stored at a particular place that only the insured person knows apart from the nominee.
There are times when there is change of residence. During shifting, it so happens that the insurance is totally forgotten, the insurance company is not notified about the address change and/or the documents gets misplaced. Since the records aren’t updated, it becomes difficult to do anything about it.
Cheque isn’t available
Cheque payments can get misplaced and inaccessible. You can prevent such chances by enrolling for electronic transfer of funds.
Do not leave your hard earned money inaccessible to your family. Let them know where you keep the document, who is the beneficiary and where you have taken the Insurance. For more information visit www.moneymindz.com or give a missed call to 022-62116588.
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