If you are a life insurance beneficiary and the insurance company says there is a “beneficiary dispute,” you usually get one of three outcomes.
The insurer pays you.
The insurer pays someone else.
The insurer refuses to pay anyone and sits on the money while it “investigates.”
That third outcome is where families lose months, sometimes longer, because the insurer has no urgency unless you create it. A well written demand letter can do exactly that. Not by threatening wild claims, but by forcing the carrier to make a clean choice: pay the benefits, deny and explain why, or file interpleader and let a court decide.
This draft shows you how to write that kind of letter in plain English.
What “forces” a decision in the real world
Insurance companies often keep disputes in limbo because it is safer for them. If they pay the wrong person, they risk getting sued by the person they did not pay. If they do nothing, they hope the beneficiaries fight each other, give up, or accept a low compromise.
Your goal is to take away the “do nothing” option by doing three things in one letter.
Make the dispute understandable and document based.
Show you are ready to provide any reasonable proof quickly.
Set a short, reasonable deadline for a written coverage position or an interpleader decision.
You are not trying to win the entire case inside the letter. You are trying to stop the delay, lock the insurer into a position, and build a paper trail that looks good later if the carrier stalls.
Before you write the letter, gather these items
You do not need everything. You need enough to prove you are real, prove the claim exists, and show why the competing claim is weak or unsupported.
At minimum, try to attach:
The policy number, certificate number, or employer plan information
The insured’s full name, date of birth, and date of death
A certified death certificate if you have it
Your government ID or notarized identity form if requested
The beneficiary designation form you have, or any confirmation email or portal screenshot showing the designation
Any divorce order, QDRO, separation agreement, trust document, or guardianship document if the dispute involves those issues
A short timeline of what the insurer has asked for and what you already provided
If you do not have the beneficiary form, do not panic. You can still write a strong letter, but you should ask for the full claim file and the beneficiary documents the insurer is relying on.
The structure that works
A demand letter that moves an interpleader decision is usually five parts.
A short opening that identifies the policy and the claim.
A clean summary of the dispute and why payment is due.
A request for the key documents the insurer is using.
A deadline and a request for the insurer’s written position.
A close that stays professional and keeps the door open.
The tone matters. You want calm, firm, and specific. Angry letters often get treated like noise.
Draft demand letter
[Date]
Claims Department
[Insurance Company Name]
[Address or email for claims, if known]
Re: Demand for Payment or Interpleader Decision
Insured: [Full Name]
Policy or Certificate No.: [Number]
Claim No.: [Number, if known]
Date of Death: [Date]
To the Claims Department:
I represent (or I am) [Your Name], a named beneficiary under the above life insurance coverage. This letter is a formal demand that [Insurance Company Name] either (1) promptly pay the death benefit to the proper beneficiary, or (2) if the company contends it cannot safely do so, promptly initiate an interpleader action and deposit the policy proceeds with the court.
Claim status and background
On [date], we submitted a claim for the death benefit, along with the documents requested to date, including [list what you submitted in a few words]. On [date], your office advised that payment is being delayed due to an alleged beneficiary dispute involving [name of competing claimant if known, or “another claimant”].
Our position is straightforward. Based on the policy records and the beneficiary designation available to us, [Your Name] is entitled to the proceeds. Specifically:
The beneficiary designation dated [date] lists [Your Name] as [primary/contingent] beneficiary.
There is no valid later designation that overrides it, and no documentation has been provided showing a proper change of beneficiary consistent with the policy or plan requirements.
To the extent any competing claim relies on [divorce paperwork, a will, family relationship, alleged oral statements, a power of attorney, etc.], those items do not supersede a valid beneficiary designation under standard policy and plan administration rules, absent a specific controlling document that the insurer can identify and produce.
If the insurer disagrees, it should say so in writing and identify the exact basis for withholding payment.
Request for documents and claim materials
To evaluate your position and to avoid unnecessary delay, please provide the following within ten business days:
A complete copy of the policy or certificate, including all amendments, endorsements, and beneficiary provisions.
A complete copy of every beneficiary designation in your file for this insured, including any forms submitted electronically or through an employer portal.
Any change of beneficiary requests, confirmations, portal audit trails, or correspondence reflecting attempted changes.
The complete claim file to date, including internal notes, logs, communications, and any documents submitted by any competing claimant.
A written explanation of what additional information, if any, you contend is required to determine the proper payee, and why.
Demand for action and deadline
Families should not be left in indefinite limbo while an insurer holds undisputed proceeds. If [Insurance Company Name] believes it cannot safely pay the claim due to competing demands, the correct procedure is to file interpleader promptly and deposit the proceeds with the court so the beneficiaries can resolve the dispute in the proper forum.
Accordingly, please provide a written response no later than fifteen days from the date of this letter stating one of the following:
The company will pay the full death benefit to [Your Name] immediately, and the payment date.
The company will deny the claim and provide the written denial basis and supporting documents.
The company will file interpleader, identify the intended court, and confirm the expected filing date and deposit of proceeds.
If you need a brief extension for a specific reason, state the reason in writing and propose a firm date. Otherwise, we will treat a non response as continued delay without justification and will take appropriate next steps to protect our rights.
Please direct all communications regarding this claim to me at:
[Name]
[Address]
[Phone]
[Email]
Sincerely,
[Signature]
[Printed Name]
Attachments: [List]
Common mistakes to avoid
Do not include long emotional arguments. Stick to documents and timelines.
Do not guess the law in a way that can be used against you. You can say “does not supersede” without citing statutes.
Do not demand impossible deadlines. Ten business days for documents and fifteen days for a position is usually reasonable.
Do not send the letter without a clear request for the beneficiary designations and claim file. Those are the pressure points.