Out with the lottery’s old prize claim time limit and in with the new.
In other words, the Iowa Lottery Board voted unanimously on Dec. 6 to reduce the claim time for lottery prizes from 365 days to 180 days. This change will affect these multi-state lotto games:
- Mega Millions
- Lucky for Life
- Lotto America
Redemption periods for these other Iowa Lottery games will remain 90 days from drawing dates:
- Pick 3
- Pick 4
- Scratch-off games
- Pull-tab games
Until now, Iowa has belonged to a small club of state lotteries with one-year claim limits; only 13 other states offer that long a redemption period. Once the Iowa Lottery cuts that time down, Iowa will join the ranks of 33 other states that already have 180-day claim limits. (A few allow a full six months.)
And that’s expected to happen in early 2023, although no firm date has been decided, according to Iowa Lottery vice president Mary Neubauer.
Most lottery prizes claimed before 6-month mark
Some sleuthing set things in motion. Neubauer said that unclaimed prizes of varying amounts prompted the Iowa Lottery to investigate. Around $1.2 million up to $1.5 million in yearly prizes expire, she told Radio Iowa.
The IA Lottery began looking into why that was so by performing an internal study. They started by reviewing a single drawing day for the four multi-state lotto games and how long it took for that day’s winning tickets to get redeemed.
It turned out that except for less than 3%, winners tended to claim prizes before 180 days elapsed. Then the board reviewed more days that brought about the same result. In Neubauer’s words:
“Time and time again. We saw that less than 3% of the monetary value of the prizes that had been won in those particular drawings were claimed after the sixth-month mark.”
The conclusion drawn, in short? “If the prize was going to be claimed, it was claimed in the first six months,” Neubauer said.
Security issues arising from longer redemption periods provide another reason for the impending change. According to the Iowa Lottery, “As time passes, it becomes more difficult for those involved to accurately recall the details of a ticket purchase and provide that information to the Iowa Lottery for verification purposes.”
And, of course, as more time goes by, the more likely lottery players are to displace, forget, or damage a ticket.
When to expect the Iowa Lottery claim time changes
According to Neubauer, a transition period will have to precede the complete changeover to shorter claim times. Before the alteration, the Lottery has to finish testing its system throughout the state.
For the time being, the Iowa Lottery expects the redemption period change to take effect sometime in the first quarter of 2023.
A benefit of the shorter claims period is that unclaimed money will go back into the prize pool faster. Neubauer stressed that this doesn’t provide any advantage to the lottery itself. The state doesn’t keep the money from unclaimed prizes, she explained.
“Under state law, the money from prizes that expire in Iowa without being claimed will continue to go back to players through the Lottery’s prize pools for future games and promotions,” the agency said in a press release.
Why do lottery winners wait to claim prizes?
Lost or forgotten tickets aren’t the only reasons winners may delay claiming prizes. Other reasons for putting off redeeming prizes may include the following:
- Avoiding publicity. Waiting may mean the press loses interest.
- Needing time to decide between taking a lump-sum payment or an annuity.
- Needing time to cope with getting a life-changing amount of money.
- Wanting to confer with financial experts first.
In what may be a record length of time, two New York brothers had another reason for waiting six years to claim their 2006 $5 million prize. The younger one explained in 2012 that he hadn’t wanted someone to marry him for his money.
Good news for the Iowa Lottery
The Iowa Lottery has experienced an excellent beginning for Fiscal Year 2023, Radio Iowa reported in the fall. Credit for that goes to an increase in drawings, including a third weekly drawing for Powerball and daily drawings for Lucky for Life.
Plus, over 50 Walmarts began selling lottery tickets.