The death of a spouse has major financial implications – and they come precisely at a time of great emotional stress. A sound financial strategy is needed to help minimize any potential financial burdens, so you can focus on what’s truly important – healing and moving forward.

Support From Professionals

Dealing with the copious financial paperwork that comes with the loss of one’s spouse is the last thing a grieving widow or widower wants to do. However, some clarity can lighten the burden – starting with a list of the professionals you should contact:

• Your attorney – to review your spouse’s will with you and begin estate settlement procedures
• Your funeral director – to help you obtain copies of the death certificate, as well as applications for Social Security and veterans benefits. Funeral directors can be an excellent source of information
• Your life insurance financial professional – to assist with the life insurance claims process. You also can contact the company’s policyholder service department directly
• Your financial advisor or accountant – to help with the overall organization of your finances

Immediate Expenses

You may receive a steady stream of bills at this time –funeral expenses plus any outstanding debts your spouse may have incurred, can add up to a substantial sum.

Even if you expect money from one or more insurance policies or the estate settlement, it may not come in time for the bills. You may find yourself with insufficient funds to pay them all. Fortunately, there are several options still available to you:

Along with any short-term financing options you may already use (credit cards, home equity line of credit) another option may be an advance or loan against any life insurance benefit due. Be sure to ask your financial professional if this is an option for you.

Claiming Life Unsurance Benefits

If you are the beneficiary of your spouse’s life insurance policy, you must file a claim in order to receive your benefits – the payout is not automatic. Usually, it is a simple matter of calling your insurance agent, and the deceased’s employer, if there is a company life insurance benefit, and then filling out the paperwork. Be sure to have a certified copy of the death certificate for each insurance company.

However, may also find insurance benefits of which you were unaware, but to which you are entitled. For example:

• Individually owned policies. Be sure to check files or safe-deposit boxes to be sure there is not a policy or other accounts of which you were not aware. If you know there was a policy somewhere, but you don’t know with whom, cancelled checks may help you find the company. Or contact your state insurance department for the names of companies that may help you find the policy, for a fee.
• Group life insurance policies. These may be issued through an employer, bank, credit agency or other professional or social organizations, and they often pay benefits in specific circumstances. Look for a certificate of insurance for proof that your spouse was insured. But if you can’t find any certificates, it doesn’t mean your spouse was not insured. Check with those groups just mentioned.

The following are some group policies to check:

• Employer-based. Because some employers offer employees a certain amount of life insurance, you may be unaware that there is a policy. Look at pay stubs or call the employer directly.
• Accidental death and dismemberment. You spouse may have this coverage from an employer, credit card, or bank. You may be unaware of this policy as well, as it can be offered as part of a loan package or issued as a free benefit by banks, or as a rider to an employer-issued insurance policy. Check with the employer, bank or insurance company.
• Travel accident insurance. If your spouse was killed while traveling by air, boat, or train, there may be benefits from a policy purchased when buying the tickets. If your spouse used a credit card to buy tickets, you may automatically be entitled to a benefit if he or she died because of an accident while using those tickets.
• Mortgage life insurance. A mortgage life insurance policy pays off the balance of the policyholder’s mortgage upon death. Remember to contact the mortgage lender to see if your spouse purchased this policy.
• Credit life insurance. This insurance pays off the outstanding balance of a loan or account. A few dollars are simply added to the monthly payments to pay the premiums – again, there is no obvious indication that your spouse retained this coverage, so check with the credit issuer.

Filing And Collecting On Life Insurance

To file a life insurance claim, take the following steps:

• Notify the insurance company that the policyholder has died as soon as possible. Call the policyholder services department directly, or the agent or employer if the policy was issued through them. If your policy was purchased from AXA Equitable, see our Customer Service Common Requests page for information on AXA Equitable's process. 
• File a claim form.. Fill out and sign a claimant’s statement and attach it to an original or certified copy of your spouse’s death certificate. Your insurance agent may do this for you if asked. If another beneficiary is named on the policy, that person also must fill out a claim form. You may also have to fill out IRS Form W-9 (Request for Taxpayer Identification Number and Certification), which enables the insurance company to notify the IRS of any interest it has paid you on the value of the policy. To fast-track your claim, follow the insurance company’s instructions to the letter.

Life insurance claims are usually paid quickly, after the company ensures that

• You are the true beneficiary
• The policy is current and in force, and
• That all conditions of the policy have been met.

Most delays happen because the insurer has not received a valid death certificate. However, if the insured died within two years of purchasing the policy, or the insurer believes there is fraud or a misstatement on the application, they have the right to contest – and maybe deny – the claim.

In what form should you take the payment? Many people opt for a lump sum of cash, as it provides greater control over the money, and the proceeds are not subject to income tax.

You can also take a settlement option. This graduated payout option may have been stipulated when the policy was purchased. If it was not, you may still have the opportunity choose it. If you are unwilling or unable to manage a large lump sum of cash, this may be an appropriate choice for you.

Social Security Survivors' Benefits

To claim survivor’s benefits, your spouse must have accumulated enough work credits –forty credits (10 years of work) are all that is needed. However, under a special rule, if your spouse had only 6 credits in the 13 quarters prior to his or her death, you and your children can still receive benefits.

You are eligible for survivor’s benefits if you are:

• A spouse, age 60 or older (50 or older if you are disabled)
• A spouse, caring for a child who is under age 16 or disabled
• An ex-spouse, age 60 or older (50 or older if disabled), and were married to the deceased for at least 10 years
• An ex-spouse of any age, if you are caring for your child who is under age 16 or disabled
• An unmarried child under 18
• An unmarried child under 19, and attending school full time (up to grade 12)
• Dependent parents age 62 or older

You can find out how much you are eligible to receive in survivor’s benefits – as well as the death benefit amount, and the applications and documents you must present – at the Social Security Administration office or website.

Sorting through all the tasks involved with losing your spouse can be challenging. This is the time to reach out for assistance. Proper guidance from your trusted financial professional can help to put you back on the path to financial stability.