Just a note: Life Insurance carriers are now required to do checks against the SSI Death Index. Policies with lots of cash can live off the cash. I used to work for an agency that had been around for several decades, and when they used to generate more paper for annual statements, you would see policies that had been inforce for YEARS and the ibsured was very old. The key was the policy was purchased when the person was young and therefore the premium low. You would look at the age of the insured and think does this person even know they have a policy. Then I realized what was happening.

This is part of the reason they are now required to run the check; to ensure the beneficiary receives the benefits. The complaint was the company not paying out the benefits when they accepted the premiums. Most claims are because the beneficiary notifies the company, but what if you don't know about it? If it lapses because the client is dead, oh well. This is to prevent that.

This happened when my FIL passed. I did all the final paperwork, but I missed an old policy he had as a retirement benefit. I think it was like $5K. But one day, it showed up in the mail for my MIL.

But as to your overall thesis, it is rather chilling plausibility.