Do Life Insurance Companies Check Your Medical Records After You Die?

Written by James Hirby and Fact Checked by The Law Dictionary Staff  

For many middle-class Americans, life insurance is an essential form of financial protection. There are two basic types of life insurance: term and whole. Within these broad categories, there are several different policy types that may be customized to fit a wide range of needs. For the purposes of this explanation, it's unnecessary to get into the details of each and every type of life insurance.

However, it's important to make a key distinction between the term and whole life insurance. Whereas whole life insurance is generally regarded as a quasi-investment vehicle that can help protect against financial shocks like job loss or permanent disability, term life insurance exists solely to cover the costs associated with the policyholder's untimely death.

If you take out a term life insurance policy, you must be aware that it won't accumulate any cash value. It will only produce income for your descendants in the event that you die before its expiration date. Term life insurance policies typically remain effective for between 10 and 30 years. Once their initial terms have expired, they may be renewed for additional lengths of time. These renewed policies almost always cost more than the policies that they replace.

If you die during the effective period of your term life insurance policy, your policy's beneficiaries stand to receive the policy's so-called death benefits. In most cases, your policy's underwriter will be prepared to pay out these benefits within two to three weeks of your death. Unless your beneficiary opts to receive the benefits in a single lump-sum payment, your underwriter will make annual "annuity" payments over the course of 15 to 30 years.

Before it agrees to make the first annuity payment, it may take steps to confirm that your death occurred naturally. If you died in an unusual or suspicious situation, it may withhold benefits in lieu of a full investigation. Depending upon the policies of the life insurance company in question, this may take weeks or months. In most cases, life insurers will refuse to make payouts on suspicious death claims until police and medical officials have made the results of their official investigations available to the public.

Your policy's underwriter may actively participate in these investigations. If this is the case, it may be granted access to your official medical records. However, this may prove expensive and time-consuming for your insurer. If there's no investigation into your death, it's unlikely that your life insurance provider will care to review these records.

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