Life insurance policies are a vehicle used in Estate Planning along with various investments to ensure your accumulated wealth is passed on as per your wishes.
I don’t think many clients would like their wealth passed on to the Commonwealth.
Did you know?
Around $65 million of life insurance policies payouts remain unclaimed according to the Australian Securities and Investments Commission (ASIC).
ASIC said the $64.6 million of unclaimed life insurance policies were part of a $1.2 billion pool of unclaimed monies held in banks accounts, life insurance policies and shares and other investments.
ASIC said it has records of unclaimed money going back to 1952 for life insurance companies and back to 2000 for friendly societies.
The corporate regulator holds money from life insurance policies, issued by an insurer or friendly society, which has remained unclaimed for seven years after the policy matures, and will be required to hold it for three years from 31 December 2015 after the law was changed.
After that time the unclaimed funds are transferred to the Commonwealth with ASIC Deputy Chair, Peter Kell stating the funds can still be claimed by the rightful owners.
Plus, who knows the dollars lost when life companies lapse policies because they do not receive premium payments after one has passed, when in fact the estate should have claimed for the benefits. Was the policy listed as an estate asset?
“Unclaimed money is transferred to the Commonwealth after it’s been unclaimed usually for seven years. The unclaimed money is managed by ASIC, it’s always claimable by the rightful owner and there’s no time limit on claims. Last financial year, over $158m was paid out to more than 25,000 people,” Kell said.
Have you recorded all your investments assets and Life Policies in your planning, do the right people know what to do where to go and what you have to be distributed, is it regularly reviewed and updated? Let us know if you need help with any of these questions.
This information is general information only. You should consider the appropriateness of this information with regards to your objectives, financial situation and needs.