If your loved one had life insurance through their job, you claim it by contacting the employer's HR or benefits department, which will send you a claim form for the insurance company that carries the group policy. You'll submit that form with a certified death certificate, and most group life claims pay out within two to four weeks. The employer sponsors the coverage, but an insurer like MetLife, Prudential, The Hartford, Unum, or Securian actually writes the check.

That sounds simple, and often it is. But employer coverage comes with rules that individual policies don't have, and a few of them catch families off guard. This guide walks through the claim step by step, including what happens if your loved one had already left the job, and what to do if the insurer stalls or denies the claim.

What employer life insurance actually is

Most mid-size and large employers give employees a basic group term life policy at no cost, usually equal to one or two times the employee's salary. Many employees also buy supplemental coverage (sometimes called voluntary or optional life) through payroll deductions, which can add several times their salary on top. There may also be accidental death and dismemberment (AD&D) coverage, which pays an extra benefit if the death was the result of an accident, and small dependent life policies covering a spouse or children.

Two things make employer coverage different from a policy your loved one bought on their own:

• It's a group policy. The employer holds the master contract, and each employee is a certificate holder. The claim runs through the employer's benefits team and the group insurer, not through a personal agent.
• It's governed by ERISA. The Employee Retirement Income Security Act, a federal law, controls most private-employer benefit plans. ERISA sets deadlines for the insurer, gives you formal appeal rights, and (importantly) means the beneficiary form on file almost always wins, no matter what a will or state law says.

Step 1: Call the employer's HR or benefits department

Start with the employer, even if you already know which insurance company carries the policy. HR needs to report the death, confirm the coverage amounts, and start the claim. When you call, ask about each layer by name:

• Basic group life (employer-paid)
• Supplemental or voluntary life (employee-paid)
• AD&D coverage
• Dependent life coverage
• Any retiree life benefit, if your loved one had retired from the company

Ask HR to confirm the named beneficiary on file and the total coverage amount in writing. Families routinely learn about supplemental coverage they never knew existed, and it's often the larger number.

If the company has been acquired, merged, or shut down, don't give up. Benefits obligations usually transfer to the successor company. Search for the current company's HR contact, or check your loved one's old pay stubs and benefits enrollment emails for the insurer's name and reach out to the carrier directly.

Step 2: Gather the documents

The insurer will ask for:

• A certified death certificate. Nearly every carrier requires a certified copy, not a photocopy. If you haven't ordered them yet, our guide on how to order death certificates covers how many you'll need for the whole estate.
• The completed claim form. HR or the insurer provides this. Each beneficiary files their own form.
• Your ID and Social Security number. The payout is reported to the IRS, so the insurer needs to verify who you are.
• Accident documentation, if claiming AD&D. Police reports, accident reports, or a coroner's report. AD&D claims get more scrutiny than basic life claims, so expect the insurer to ask for records.

Step 3: Submit and track the claim

Send the claim to the insurer, not the employer, unless HR tells you otherwise. Keep copies of everything and note the date you submitted. Under ERISA, the insurer generally has 90 days to decide the claim, though most straightforward group life claims pay much faster. If you hear nothing within 30 days, call the carrier and ask for a status and a list of anything still missing. Incomplete paperwork is the number one cause of delay.

What if they no longer worked there?

This is the trap that catches the most families. Group life coverage usually ends 31 days after employment ends. Within that 31-day window, the employee had the right to convert the group coverage to an individual policy or port it (keep it as term coverage by paying premiums directly). If your loved one converted or ported the policy, it's still in force. If they didn't, the coverage likely lapsed.

Still, check before assuming the worst:

• Death within 31 days of leaving the job. If your loved one died during the conversion window, the group policy typically still pays, even though they were no longer employed.
• Retiree life insurance. Some employers, especially older companies, unions, and governments, continue a reduced life benefit into retirement. Call the benefits office of every major employer in your loved one's career, not just the last one.
• Disability waiver of premium. If your loved one left work due to disability, many group policies kept the coverage in force with premiums waived. This is one of the most commonly missed benefits.

If you're not sure what coverage existed where, a broad policy search is worth the effort. Sunset runs searches across insurers and employers as part of settling an estate, and finding an unclaimed employer policy is one of the most common results.

Who gets the money

The beneficiary designation on file with the plan controls the payout. Under ERISA, that form generally overrides a will, and in most cases it even overrides state laws that would cut out an ex-spouse after a divorce. If your loved one named their former spouse years ago and never updated the form, the former spouse likely gets paid. This surprises a lot of families, and it's worth knowing before anyone counts on the money.

If no beneficiary was named, or the named beneficiary died first, the policy's default order applies. A typical order is spouse, then children, then parents, then the estate. If the money goes to the estate, it may need to pass through probate, and the executor will need an estate bank account to receive it.

How the payout arrives, and what's taxable

Most beneficiaries can choose a lump-sum check or transfer. For larger payouts, many insurers instead open a retained-asset account, an interest-bearing account with a checkbook, as the default. You are allowed to write one check for the full balance and move the money wherever you want, so don't feel locked in.

On taxes: life insurance proceeds are generally not income to the beneficiary, so the death benefit itself arrives income-tax free. Any interest the insurer pays on top of the benefit (for the time between the death and the payout, or inside a retained-asset account) is taxable, and you'll get a 1099-INT for it.

If the claim is denied or drags on

Group life denials usually cite one of a few reasons: the coverage lapsed when employment ended, supplemental coverage required proof of good health that was never completed, the death fell under an exclusion, or there's a beneficiary dispute. Because ERISA governs the plan, you have formal rights:

1. You get the denial in writing. The insurer must explain the specific reason and cite the plan language it relied on.
2. You can appeal, and you must. ERISA requires you to file an internal appeal (you typically get at least 60 days) before you can sue. Request the full claim file and the plan documents; the insurer has to give them to you.
3. You can take it to federal court. If the appeal fails, ERISA lets you file suit in federal court to recover the benefit.

Appeals have real deadlines, so don't sit on a denial letter. For a deeper look at the appeal process, see our guide on how life insurance claims work.

One note on scope: this guide covers private-employer coverage. Federal employees (FEGLI) and service members (SGLI) have their own claim systems with different forms and rules.

Where Sunset fits in

An employer life policy is usually just one piece of what a family has to sort out. Sunset helps families settle the whole estate for free: we search for accounts and policies the family may not know about, prepare the probate paperwork for any county in the country, open an FDIC-insured estate bank account, and handle transfers to heirs. More than 10,000 families have used Sunset to close out a loved one's affairs. If you're also sorting out Social Security, a pension, or bank accounts, we can take most of it off your plate.

Frequently asked questions

How do I find out if my deceased loved one had life insurance through work?

Call the HR or benefits department of their current employer and any past employers where they spent significant time, and ask about basic, supplemental, and retiree life coverage. Check pay stubs for deductions labeled "voluntary life" or "optional life," and look for benefits enrollment paperwork or emails. Sunset can also run a policy search as part of settling the estate.

How long does an employer life insurance payout take?

Most group life claims pay within two to four weeks once the insurer has a complete claim form and a certified death certificate. Under ERISA the insurer can take up to 90 days to decide, and AD&D claims often take longer because the insurer reviews accident records.

Is employer life insurance taxable to the beneficiary?

The death benefit itself is generally income-tax free. Interest the insurer adds on top of the benefit is taxable income, and you'll receive a 1099-INT for it.

What happens to life insurance when someone leaves a job?

Group coverage usually ends 31 days after employment ends unless the employee converted it to an individual policy or ported it. If the person died within that 31-day window, the group policy typically still pays. Retirees may keep a reduced benefit, and employees who left on disability may have had premiums waived with coverage kept in force.

Who gets the money if no beneficiary was named?

The plan's default order applies, commonly spouse, then children, then parents, then the estate. If the benefit goes to the estate, it may pass through probate before reaching heirs.

Settling a loved one's estate? Sunset handles asset discovery, probate paperwork, the estate bank account, and transfers to heirs, free for families. Get started at hellosunset.com.