State RegulationsVA specificDifficulty 2/5
An insured dies on June 1. The beneficiary asks the insurer how interest on the unpaid death proceeds is computed and when it begins. Under Virginia law, the correct answer is:
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Answer & full 3-part explanation (select an option above, or peek)
Why B is correct
Va. Code § 38.2-3115 requires death proceeds to earn interest from the date of death, computed daily at 2.5% per year or at the insurer's greater applicable interest-settlement rate. The statute puts the burden of the settlement interval on the insurer, so interest flows automatically without any request or waiting period from the beneficiary.
Why the other options are wrong
- A) A proof-of-loss waiting period governs claim-interest rules for health claims, not death proceeds; Va. Code § 38.2-3115 starts interest at the date of death.
- C) The rate and start date come from Va. Code § 38.2-3115, not from a one-year delay or whatever rate the policy names.
- D) Interest accrues automatically under Va. Code § 38.2-3115; no written request from the beneficiary is a precondition.
Memory hook
Daily at 2.5% from the date of death — automatic, not on request.