Short answer: Some states require life insurers to add interest when paying a death benefit. In California, interest applies when proceeds aren't paid within 30 days of death and runs from the date of death. In Florida, lump-sum death payments must include interest from the date the insurer receives proof of death. Washington sets a floor of 8% from the date of death, and Hawaii and Vermont set a 6% floor.
Check your settlement statement for an interest line. Beneficiaries can ask the insurer how interest was calculated.
The table
| State | When interest applies | How it's figured | Source |
|---|---|---|---|
| California | If the insurer doesn't pay life insurance proceeds within 30 days after the insured's death | Interest at no less than the insurer's current rate on death proceeds left on deposit, counted from the date of death, on amounts still unpaid after the 30 days | Cal. Ins. Code §10172.5 |
| Florida | Lump-sum death benefit payments must include interest | Interest from the date the insurer receives written due proof of death, at a rate at least equal to Moody's Corporate Bond Yield Average (monthly average corporate) as of the day the claim was received | Fla. Stat. §627.4615 |
| Hawaii | Interest applies unless the death proceeds are paid within 30 days of the date of death | With no lawsuit, interest is computed daily from the date of death to payment at the insurer's rate on proceeds left under the interest settlement option, but not less than 6% a year | HRS §431:10-243 |
| Minnesota | Interest is owed on all life insurance proceeds from the insured's death until payment | At least the insurer's rate on death proceeds left on deposit (or its policy loan rate if it has none). If not paid within 60 days after due proof of death, the rate is 2 percentage points higher, still counted from the date of death | Minn. Stat. §61A.011 |
| Mississippi | Proceeds become due as of the date of death, and interest is owed on them; doesn't apply when total death proceeds from the insurer are under $5,000 | From death until payment, at the greatest of the policy's guaranteed rate, the current rate on death proceeds left on deposit, or the current rate on dividends left on deposit | Miss. Code §83-7-6 |
| New York | Interest is owed on death proceeds of policies delivered or issued in New York | With no lawsuit, computed daily from the date of death to payment at the insurer's current rate on proceeds left under the interest settlement option; different rules apply after a judgment or settlement | N.Y. Ins. Law §3214 |
| Texas | Interest on life insurance proceeds accrues from the date the insurer receives due proof of loss until it accepts the claim and offers to pay | Paid with the proceeds, at the policy's rate or, if none, the rate the insurer pays on proceeds left on deposit | Tex. Ins. Code §1103.104 |
| Utah | On policies issued on or after May 5, 2008, interest on death proceeds runs from the date of death until the claim is paid | At least the greater of the rate on funds left on deposit or the 2-year Treasury rate. If the claim still isn't paid 31 days after proof of death and other required information, an extra 10% a year is added | Utah Code §31A-22-428 |
| Vermont | Life insurance claims must be paid within 30 days after the insurer receives a properly executed proof of loss, and all payments must include interest | Interest from the date of death to payment, at the rate paid on proceeds left on deposit or 6%, whichever is greater | 8 V.S.A. §3665b |
| Washington | Interest is owed on death benefits when the insured was a Washington resident at death | From the date of death at the insurer's rate on other withdrawable proceeds but not less than 8%; if not tendered within 90 days of receiving proof of death, that rate plus 3% from day 91 | RCW 48.23.300 |
We list only states where we read the official text ourselves in October 2026. A state that is missing is not covered here; check that state's statute or insurance department.
For beneficiaries
- File the claim promptly with a certified death certificate.
- Ask how interest was calculated if it isn't shown.
- Can't find the policy? See how to find a lost life insurance policy in California.
See the state insurance rules hub.
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Methodology
Each row was read from the official source linked in the Source column in October 2026. This is general information, not legal advice. See also the state insurance rules hub.
Frequently asked questions
Do life insurance companies pay interest on death benefits?
In some states, yes. California requires interest on proceeds unpaid more than 30 days after death (Ins. Code §10172.5). Florida requires interest on lump-sum death payments from receipt of proof of death (Fla. Stat. §627.4615).
When does interest start in California?
It's computed from the date of the insured's death, on amounts still unpaid after 30 days.
Alishahi Insurance · 439 N Canon Dr, Penthouse, Beverly Hills, CA 90210 · (877) 711-4545 · CA License #4348151. General information only. Not legal, tax or financial advice, and not a coverage determination. Coverage depends on policy language and underwriting, and rules vary by state.