After the death of a loved one, one task that you need to take care of is making claims against any life insurance policies held by the deceased. You will need to know where your loved held any policies to begin the claims process. Here are a few important details you need to know when making life insurance claims.

1. You Need to Have a Certified Copy of the Death Certificate

To make a proper claim, you must have a certified copy of your loved one's death certificate. A certified death certificate has a raised seal to prove its authenticity. You can procure a copy from the Department of Vital Statistics in your area.

It may take a couple of weeks after your loved one's death before a certified death certificate is available. If you need money from the life insurance policy for burial expenses, this can pose a problem. However, if you bring in proof of the life insurance policy to the funeral home, your funeral home may be willing to forgo payment until you receive the money from the life insurance claim.

2. You May Have Options Regarding the Policy's Payout

The details vary depending on the life insurance policy, but you may have a few different options for how you can receive the proceeds from the policy. Some policies issue the payout in a lump sum; this means that you receive the entire payout in a single amount.

Other policies permit you to receive payments over a stated length of time. If you opt for this alternative, you will also receive regular interest payments based on the value of the policy.

A third option is to spread the insurance payments out over the remainder of your life. With this choice, you are guaranteed to receive an annual payment until your own death. When deciding how to receive the payout, take into account what one-time expenses you need to cover with the money (such as burial costs) and your own income requirements.

3. Open a Safe, Interest-Bearing Bank Account to Temporarily House the Money

Many professionals recommend that you avoid making important decisions immediately after the death of a loved one. This includes decisions concerning how you will use or invest money from a life insurance policy. It is important to give yourself a chance to grieve and heal.

In the meantime, keep the money in a safe account that pays some type of interest, such as a savings account or money market account. You will have the money on hand to cover any necessary expenses, but you do not have to worry about losing any of the principle. Once a year or so has passed, you can make more permanent decisions concerning how you want to use or invest the money.