Insurers work to connect policies with beneficiaries

From the moment they met as teenagers and blossoming ballet dancers, Karen Brown and Mel Tomlinson were best friends.

“I was just grateful for the time I had with him. Our connection was eternal. He knew how much I loved him, and I knew how much he loved me . ... He had one of the most amazing lives of anyone I personally knew,” Brown said.

What Brown, 64, didn’t know about Tomlinson, who died last year at age 65, was that he had an annuity with Nationwide, and she was the beneficiary.

That is until the insurer reached out to tell her that she was entitled to an $800 payout.

“As much as I know about his finances, did I know he had a policy with Nationwide? No, I didn’t,” she said.

Nationwide’s search for Brown is part of the stepped up effort by the industry to find beneficiaries of life insurance policies and annuities for which a claim has not been made.

In addition to the work being done by insurers, state and national insurance groups also are getting involved. The Ohio Department of Insurance launched a website last month to help Ohioans locate a deceased family member’s missing life insurance policy or annuity contract. The Life Insurance Policy Locator is a free service from the National Association of Insurance Commissioners. The service also can be found at the state insurance department’s website, www.insurance.ohio.gov.

The state said its program has matched thousands of people with policies totaling more than $11 million.

“This search service provides a real benefit to Ohioans, simplifying what otherwise could be a cumbersome and lengthy process identifying potential beneficiary life insurance proceeds,” Jillian Froment, Ohio’s insurance director, said in a statement.

Under the program, executors, legal representatives of a deceased person, or people who believe they are beneficiaries can submit a search request. Insurance companies search their records and directly contact the person if they find a match, usually within 90 days.

The national association estimates that millions of dollars in insurance benefits go unclaimed every year because beneficiaries can’t find their loved one’s policies or might not know that a policy exists.

Since its website was launched in 2016, the association had received 168,719 requests through Nov. 30.

Those requests have led to 56,148 matches of lost or misplaced life insurance policies or annuities, and claim amounts totaled $787.9 million.

The service was implemented after tornadoes struck Joplin, Missouri, in 2011 and killed more than 150 people and injured more than 1,000. The storms also destroyed records of life insurance policies and annuities.

“Sifting through paper and electronic files of a lost love one is difficult, especially if you don’t even know where to start looking,” said Ray Farmer, South Carolina’s insurance director and the current president of the national association. “The NAIC helps connect beneficiaries to policies in a manner that is secure, confidential and free.”

Years ago, many insurers were criticized for not doing enough to look for beneficiaries who hadn’t filed claims. Some, including Nationwide, settled investigations by state insurance commissioners by agreeing to do more to find beneficiaries when they know or suspect that a policyholder has died.

Insurers, for example, can use Social Security death records to compare against their list of policyholders.

Nationwide recently was able to track down Misty Smith of Santa Maria, California, the beneficiary of a life insurance policy belonging to her father, Leonard Smith, who died in July at age 87.

Smith said her father left no will or paperwork and rarely discussed his finances.

“He kept all that to himself,” she said.

When Nationwide contacted her last fall, she initially wondered whether the query was legitimate. Smith, 62, had her attorney check it out.

She received $5,000 from the policy, enough to cover the taxes on her dad’s home.

“I’m so thankful he did it,” she said of her father’s policy. “It was a blessing.”

For Karen Brown, the money she received will go toward converting part of her home into a dance studio.

She and Tomlinson performed with top touring ballet companies.

She had no idea that Tomlinson had picked her as the beneficiary on the policy, which Nationwide said was issued in the early 1990s.

Tracking down Brown was tough. Tomlinson didn’t include Brown’s date of birth or Social Security number on the policy, and Brown’s name is common, the insurer said. Ultimately, Nationwide was able to find her through a biography that Brown had written about Tomlinson and posted online.