What Is the Average Life Insurance Payout Time?

In this article...
  • Find out what the average life insurance payout time is. Learn what might delay a payout and discover when insurance companies may deny death benefit claims.

When someone who has life insurance dies, one of their beneficiaries must file a claim to receive the death benefit. The insurance company then processes the claim and issues the payout. How long you can expect to wait following submission of a claim depends on a variety of factors.

What Is the Average Life Insurance Payout Time?

The average life insurance payout time is 30 to 60 days. The timeframe begins when the claim is filed, not when the insured dies.

What Is the Average Payout for Life Insurance?

Payouts on life insurance policies depend on: 

  • Face value of the policy
  • Money owed in loans against the policy
  • Amount of cash withdrawals made from permanent insurance policies
  • Use of riders that reduce death benefits, such as the Advanced Death Benefit (ADB) rider, which allows the insured to receive some of the death benefit early to cover the cost of hospice care and other expenses related to a terminal illness

Statista reports that the average face value of life insurance policies sold in the United States ranges from $150,000 to $185,000, depending on the year. In the late 1990s, average face values were much lower, ranging from $100,000 to $140,000.

What Affects the Speed of Insurance Payouts?

Some factors that impact the speed of payouts include:

  • Payout method. The way you opt to receive a payout can impact the speed of processing. Generally, annuity payments that give you some money every year for a set period require less setup time than lump-sum payouts.
  • Beneficiary identification. If the life insurer has trouble determining who the beneficiaries are or locating them, payouts may be delayed.
  • Number of beneficiaries. Policies with more beneficiaries often take longer to process than ones with a single beneficiary.
  • Contingent beneficiaries. The individuals who an insured person wants to receive the death benefit first are the primary beneficiaries. If they die before the insured, the money goes to contingent beneficiaries. Life insurance companies will need to verify the death of primary beneficiaries, leading to delays in payouts to contingents.
  • Errors on the claim form. Incomplete claim forms and mistakes can cause payout delays.
  • Cause of death. Homicides and suicides usually require a complete investigation prior to payout.

What Reasons Will Life Insurance Not Pay?

Life insurance may deny claims under some circumstances, including suicide, homicide, false statements and expired policies.


Nearly all life insurance policies have an initial incontestability period of approximately two years. If a person commits suicide before the contestability period ends, the insurance company may deny the claim. Some policies have suicide clauses that prohibit payouts for suicide regardless of when they occur.


If the beneficiary of a life insurance policy is found guilty of killing the insured, the life insurance company won't issue the payout to them. Contingent beneficiaries will usually get the money instead.

False Statements on Applications

If the insurer determines that the insured lied on their application, claims are typically denied. False information could include: 

  • Not disclosing an existing medical condition or exposure to a contagious illness
  • Hiding medical histories of close relatives
  • Claiming not to smoke, drink alcohol or use recreational drugs
  • Not mentioning risky recreational activities or work-related tasks
  • Failure to disclose travel plans

Expired or Canceled Policies

Term life insurance policies have an expiration date. Claims made after this date won't be paid. If the insurance company cancels any type of insurance policy, you can't receive a payout from it. Failing to pay premiums is the main cause of insurance policy cancellation.

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