What to do when a Unum account holder dies

Not while it is group coverage. Your employer owns the group policy; you hold a certificate, and there is no individual contract to assign to an ILIT. You can name a trust as beneficiary of the group certificate, but the coverage itself cannot be retitled. The one route to an assignable individually owned policy is Unum CONVERSION: within 31 days of the date your group coverage ends, you may convert group term life into an individual whole life policy that builds cash value, at individual rates. Unum states the right to convert is guaranteed by law in certain circumstances, and conversion applies to life insurance only, not AD&D. Once the policy is individually owned, ownership can be assigned to an ILIT through Unum policy service (800-445-0402) — subject to the federal three-year lookback, which pulls the death benefit back into your taxable estate if you die within three years of the transfer. Convert or port through: Unum, Portability and Conversion Unit, 2211 Congress Street, Portland, ME 04122, 800-421-0344, PortabilityConversion@unum.com.

Per Unum claim form CL-1091: a benefit under $10,000 is paid by check, and a benefit of $10,000 or more is paid through a Unum Retained Asset Account if the group policy calls for that method (otherwise it is paid by check). The Retained Asset Account is not a bank account. Unum holds the money in its general account and credits interest; you receive a book of bank drafts and can write drafts of $250 or more, up to the full balance, at no charge for the drafts themselves. Unum does charge $5 for a copy of a draft or statement, $15 for a stop payment, $10 for a returned draft or additional statements or extra 1099-INT copies, and $25 for a rush draft book. The balance is guaranteed by Unum Group, is NOT FDIC insured, and is backed by state guaranty associations. Two estate traps: interest earned may be taxable, and if there is no account activity and no contact for two years, Unum may have to surrender the balance to the state of the beneficiary last known residence as unclaimed property. A beneficiary can request payment by check regardless of the amount by calling The Benefits Center at 800-445-0402 — but you have to ask.

The employer starts it, not the beneficiary. Form CL-1091 is written to the employer and tells it, as soon as it receives notice of the death, to complete the Employer Statement and send it to The Benefits Center, P.O. Box 100158, Columbia, SC 29202-3158, with a copy of the certified death certificate (Unum accepts a photocopy or fax), the enrollment records, and the most recent beneficiary designation. The employer then hands the beneficiary three items: the Retained Asset Account page, a Substitute W-9, and the "Authorization - Life or Accidental Death Claim," which is what allows Unum to gather information about the deceased. Unum lets the employer open the claim with the Employer Statement alone and send the rest later, so the practical move for a family is to press HR to file the Employer Statement immediately and to call The Benefits Center at 800-445-0402 (Monday-Friday, 8 a.m. to 8 p.m. ET; fax 800-447-2498) to confirm it arrived. If the coverage was ported or converted, there is no employer in the loop — call 800-421-0344 instead.

Sometimes, and there is a deadline. Unum conversion and portability rules say a spouse and children may CONVERT their dependent life coverage if the employee dies while covered under the group plan — and if the employee dies, a surviving spouse must port their own coverage in order to port the children coverage. Children coverage can be ported under the employee or the spouse, but not both. Whichever route applies, the election has to be submitted no later than 31 days after coverage ends, to Unum, Portability and Conversion Unit, 2211 Congress Street, Portland, ME 04122 (800-421-0344). This is easy to miss in the weeks after a death, and there is no extension. Separately, AD&D coverage can be ported but not converted, and Unum accident coverage simply ends on the date the insured dies.