Many people take out a life policy on a whim, some after serious consideration ad research. Unfortunately, they do not always stash the life policy papers where other people will be able to find them. This can make life very difficult for their families if the reason for the policy should come to pass.
It is definitely best to keep the policy documentation somewhere safe, but it needs to be accessible for when you are no longer able to locate it for the people who will need the details contained in it. Here are a few suggestions on where to keep it and other procedures to ensure that it does not get lost in the chaos of life and death and everything in between.
First, have a sensible filing system of some kind. This is a good idea for any kind of important documents like salary slips, insurance policies, your life policy documents, car registration papers and all your education proofs. This will help you keep everything in order and make it easy to find for everyone in the household should they need documentation of some kind. Get a filing cabinet or some of those card filing folders and label each partition neatly and logically. Try and keep things alphabetical. It just makes it easier to find things. Religiously file everything every time you get post. Do not allow it to build up until it is a daunting task.
Next, make a will that tells people what life policy you have and who underwrote it. This way, if it happens that the documentation gets lost, the family and lawyers can still go to the insurance company and get the details from them. This is not ideal, as they will have to provide proof that you are the life policy holder and are in fact deceased, but it is better than nothing. At least they will be able to make the relevant claims on the policy.
If you do not like having important documents lying around the house, then keep them in a safety deposit box or something like that which your significant others have access to and leave the details of the box in your will. The problem with doing it this way is that when a person dies, their bank accounts and assets are frozen for a period of time until the estate is sorted out. This means that your loved ones will not be able to get into the box until everything is set to rights.
A life policy is an excellent asset to have under your name. However, you o need to make sure that the people who should benefit from it are able to do so once you are no longer around. Keep the documentation somewhere safe, like in a logical and up to date filing system or in a safety deposit box and put the basic details into your will so that if the documentation is lost, your executor can still get hold of the policy and cash it in.