Articles Tagged with: Misrepresentation Denials

Post-Claim Underwriting in Life Insurance Explained

Life insurance companies commonly employ “post-claim underwriting” if a policyholder dies within the first two years of coverage. 

What is post-claim underwriting? Can life insurance companies use post-claim underwriting to deny my claim? How can a beneficiary contest a claim denied due to what the life insurance company discovered during post-claim underwriting?

Distinguished life insurance lawyer Chad G. Boonswang explains what post-claim underwriting is, how life insurance companies use post-claim underwriting to deny beneficiaries’ claims for material misrepresentation, and what to do if post-claim underwriting results in claim denial.

If the life insurance company won’t pay due to policy rescission for alleged misrepresentation, call us for help. Remember, life insurance companies only make money when they collect premiums and deny claims, so they take any opportunity to unfairly deny valid claims. Don’t take no for an answer! We have gotten many claims like this paid after we investigate. Call us today to discuss your claim.

What is Post-Claim Underwriting in Life Insurance?

“Underwriting” is the term used to describe the process by which a life insurance company calculates the risk an applicant for life insurance will die within the coverage term. Risk factors include medical history, current health, lifestyle habits, age, gender, weight, occupation, marital status, criminal history, and zip code. Those at greater risk of dying within the policy term pay more in premiums than those at less risk.

Under a life insurance policy’s incontestability clause, if a policyholder dies in the first two years of coverage the life insurance company has the right to look for false information on their application for life insurance and medical questionnaire. They look for this false information during the process of post-claim underwriting, which takes place after a policyholder dies and their beneficiaries submit their claim along with a copy of a death certificate.

If the life insurance company finds errors or omissions during post-claim underwriting, they rescind coverage for misrepresentation and deny claims for death benefits.

Is Post-Claim Underwriting Legal?

Technically, yes. Some laws have been passed in an attempt to stop it but the reality is that it still happens. State and federal law allow life insurance companies to employ post-claim underwriting to discover mistakes or omissions on a policyholder’s initial application for coverage. If they find false information or omissions, they rescind the policy and deny beneficiaries’ claims for death benefits.

This policy is meant to deter applicants for life insurance coverage from lying on their application to get lower premiums, but in practice, it results in many valid life insurance claims getting denied.

Post-Claim Underwriting in Life Insurance Claim Denials

During the contestability period, life insurance companies deny claims if the policyholder hid or falsified information on their initial application, even if that hidden or false information had nothing to do with the policyholder’s cause of death. 

Life insurance companies discover lies, mistakes, and omissions by performing post-claim underwriting, meaning that after a beneficiary files a claim they investigate the truth of the policyholder’s initial submissions. 

How Life Insurance Companies Do Post-Claim Underwriting

When a policyholder dies within the contestability period, the life insurance company reviews their application and medical questionnaire for any indication of misrepresentation. Often the information recorded on the death certificate reveals instances of misrepresentation, such as:

  • Failing to disclose smoking habit: dies of lung cancer from smoking
  • Failing to disclose heavy alcohol use: dies of cirrhosis of the liver
  • Fails to disclose dangerous sports: dies from a fall while rock climbing
  • Fails to disclose marijuana use: dies with marijuana in system
  • Fails to disclose high blood pressure: dies of heart attack or stroke
  • Lying about age: age younger on application than on death certificate
  • Lying about marital status: listed as “single” on death certificate

How to Protect Yourself Against Post-Claim Underwriting

An experienced life insurance attorney can help you get your payout in many instances of alleged misrepresentation. For example, the life insurance lawyers at Boonswang Law have gotten beneficiaries paid on denied claims after we investigated and found:

  • the policyholder made an innocent mistake without the intent to defraud the life insurance company;
  • the policyholder was unaware of the underlying condition that caused their death;
  • the life insurance agent made the mistake or omitted information;
  • the life insurance company or agent failed to question further when there were clear indications of a health condition;
  • a question on the application or medical questionnaire was confusing or ambiguous.

In many cases, we get our client paid in full. In others, we are able to settle for the amount of the death benefit minus what the policyholder would have paid in premiums had the life insurance company written the policy knowing the policyholder’s true condition.

Talk with a Life Insurance Lawyer About Your Claim Denial

Unfortunately, many valid life insurance claims get denied due to alleged misrepresentation. Luckily, there is growing awareness of life insurance companies’ practice of denying claims when they find any indication of possible fraud during post-claim underwriting. 

If your life insurance claim was denied due to policy rescission after post-claim underwriting, call us today for your free, no-obligation case review. We  appeal your denied life insurance claim or sue the life insurance company and get you paid if at all possible.

Life Insurance Companies & Your Medical Records

You would think that because you pay life insurance premiums, your beneficiaries will automatically get their payout if you die within the policy term. It is rarely that simple. 

Life insurance companies only make money when they collect premiums and don’t pay death benefits, so they look for ways to deny your beneficiaries’ claims. They may investigate your medical history to find out if you had any undisclosed illnesses, conditions, medications, or surgeries they can use to rescind your policy due to alleged misrepresentation. If the policy is rescinded, the life insurance company won’t pay.

Noted national life insurance lawyer Chad Boonswang explains how this happens and what to do about it in this comprehensive article. If your life insurance claim was denied due to misrepresentation, call the life insurance lawyers at Boonswang Law for help with your life insurance claim denial appeal. We have helped life insurance beneficiaries across the nation get the death benefits they deserve. Call us today to discuss your case.

Do Life Insurance Companies Check Medical Records Following a Policyholder’s Death?

The short answer is yes, they can. As part of most life insurance contracts, the policyholder agrees that their representative provides the life insurance company with medical records if requested. The clause may also state the circumstances under which the life insurance company will request medical records, such as:

Life insurance companies are supposed to check medical records before issuing a policy when a policyholder’s answers on the initial application and medical questionnaire indicate there may be further medical issues, or if the life insurance company needs more information about the policyholder’s health before underwriting a policy.  In reality, they rarely do so.

Do Life Insurance Companies Need Permission to Obtain Medical Records?

Yes. Under the Access to Medical Reports Act (1988) and the Data Protection Act (2018), the policyholder’s executor or other representative must provide the life insurance company with the policyholder’s medical records. The life insurance company cannot obtain medical records on their own without a representative’s consent.

That said, there are private services which provide life insurance companies with prescription histories and lab test results for a fee, without your permission. Also, life insurance companies can obtain anything in the public record, such as a DUI or a bankruptcy filing. 

Life insurance companies are motivated to collect all information possible to assess the risk a policyholder will die within the policy term and they charge premiums according to that risk. They may subscribe to a service such as the Medical Information Bureau (MIB) for this purpose.

Life insurance companies are also motivated to investigate a policyholder’s cause of death if the policyholder dies within the contestability period or of undisclosed illness, disease, lifestyle habit, or condition. Obtaining the policyholder’s medical records is part of that investigation.

How Many Years of Medical Records Can Life Insurance Companies Check?

When initially underwriting a life insurance policy, life insurance companies sometimes check up to 10 years of an applicant’s medical records. If a policyholder dies under suspicious circumstances, the life insurance company looks at the medical record they have and the record generated by the policyholder from the date that they applied for life insurance coverage to the date that they died.

Why Life Insurance Companies Want to Check Medical Records

Life insurance companies look at medical records to ascertain whether the policyholder died of an undisclosed injury, illness, disease, condition, or lifestyle habit. If the policyholder failed to disclose what eventually caused their death, the life insurance company denies their beneficiaries’ claims due to misrepresentation.

Life Insurance Companies Demanding Medical Records

Life insurance beneficiaries rarely have a choice – they must provide the life insurance companies with the medical records they demand to have their claim for death benefits processed and paid. 

If the life insurance company is asking for consent to view medical records, they are probably looking for something to give them cause to allege the policyholder lied on their application and  rescind the policy and deny your claim due to misrepresentation.

Life Insurance Company Asking for Health Care Providers of Policyholders

Most policyholders must provide life insurance companies with the name and contact information of their primary care physician as well as any medical provider they regularly see, or they’ve seen in recent years. This facilitates gathering medical information on the policyholder before issuing the policy as well as after death.

Talk with a Life Insurance Lawyer for Help

If your life insurance claim was denied due to misrepresentation and policy rescission, call us for help. We discuss your case with you free of charge.

Know that many claims which get denied due to misrepresentation are paid after we look into it and show the policyholder did disclose everything they knew or the policyholder made an innocent mistake. Don’t take no for an answer. Call us to get your life insurance claim paid.

3 small money bags in hand

The Incontestability Clause in Life Insurance Policies

You’ve probably heard of the Contestability Period, which is the two years following the purchase of life insurance during which a life insurance company can contest the beneficiary’s rights to the death benefit due to a misstatement or omission on a policyholder’s application for life insurance and medical questionnaire.

So what is an “incontestability clause?” Find out from the nation’s top life insurance lawyers at Boonswang Law. And if your life insurance company denied your claim or rescinded your coverage due to an alleged misrepresentation by the policyholder, call us. We will discuss your case with you free of charge. Our life insurance lawyers have gotten countless clients paid when their claim was initially denied due to misrepresentation.

Incontestability Clause Definition

An “incontestability clause” in life insurance is a policy provision that disallows a life insurance company from voiding coverage due to a misstatement by the policyholder after a specified period of time has elapsed since the policyholder purchased life insurance. This period of time is usually two years, but may be more.

How an Incontestability Clause Benefits Policyholders

Most life insurance policies include an incontestability clause, which closes the door on the contestability period and prevents life insurance companies from denying beneficiaries’ claims due to a misstatement or omission on the policyholder’s initial application for life insurance and medical questionnaire.

The incontestability clause helps policyholders realize their goal in purchasing life insurance, which was to make sure their loved ones got a payout in the event of their death. It also protects beneficiaries from any mistakes or omissions in the policyholder’s application for life insurance and medical questionnaire.

Exceptions to an Incontestability Clause

Life Insurance Fraud

If a policyholder fraudulently completed their initial application for life insurance and medical questionnaire, the incontestability clause will not protect them or their beneficiaries. 

For example, if the policyholder intentionally lied about having a smoking habit and dies within the contestability period, the life insurance company will rescind the policy and beneficiaries’ claims for the death benefit. If the policyholder dies after the contestability period, when the incontestability clause is in effect, the life insurance company will still deny beneficiaries’ claims.

The definition of life insurance fraud varies from state-to-state. In many states, the life insurance company must show that the policyholder intended to deceive. The life insurance lawyers at Boonswang Law have over 30 years of combined experience helping life insurance beneficiaries get what they deserve in every state in the country. Call us for help if your claim was denied due to alleged fraud or misrepresentation.

Misstating Age or Gender

In some states, when the policyholder mistakenly recorded their age or gender on their initial application for life insurance, the life insurance company cannot void coverage. Instead, they must subtract what they would have been paid in premiums from the death benefit, and pay the death benefit to the beneficiary.

Purchasing Life Insurance When Deathly Ill

As a matter of public policy and to protect consumers from high premiums, life insurance companies are allowed to deny claims for death benefits during the first two years or coverage, called the contestability period, when the policyholder makes a misstatement or omits information on their initial application for life insurance and medical questionnaire.

The contestability period protects life insurance companies from having to pay death benefits when the policyholder was so ill when they applied for life insurance that they died shortly thereafter. It is this type of scenario, along with policyholders contemplating ending their own lives, that the contestability period was intended to cover.

Tolling the Contestabilty Period

If the policyholder becomes disabled shortly after purchasing life insurance coverage and within the contestability period, the contestability period is “tolled” or continued and an incontestability clause will not take effect.

Talk with an Experienced Life Insurance Lawyer

If your claim for death benefits was denied due to death within the contestability period or death under the incontestability clause but the policy was rescinded due to fraud or misrepresentation, call us for help getting your payout. We have helped life insurance beneficiaries across the nation get the payout their loved one intended.

In some cases, the policyholder may have made a minor mistake and you can get the death benefit minus what the policyholder would have paid in premiums had they not made that mistake. In other cases, the policyholder did not make the alleged mistake or omission with the intent to defraud, such as when the policyholder does not disclose a medical condition they did not know they had.

In more cases than not, we are able to get our beneficiary clients paid when their claim for death benefits was initially denied due to death within the contestability period or death thereafter when the policyholder allegedly committed fraud. We only take cases on a contingency basis, meaning that we do not get paid unless and until you do. Call us for help – you have nothing to lose and everything to gain.

Life insurance claim

Misrepresentation On a Life Insurance Policy

Alleged misrepresentation is one of the top reasons life insurance companies deny beneficiaries’ claims for the death benefits. Find out from the nations’ top life insurance lawyers what misrepresentation is, why insurance companies deny these claims, and what you can do about it should your claim be denied for this reason.

We have gotten many life insurance claims paid when they were initially denied due to alleged misrepresentation on the part of the policyholder, by appealing the life insurance claim denial. If your claim was denied due to misrepresentation, call us. We will discuss your case with you free of charge!

What Material Misrepresentation In Life Insurance Is

“Material misrepresentation” is a lie, mistake, or omission that leads the life insurance company to believe something that is not true about the policyholder, assess the policyholder at less risk of dying within the policy term, and give the policyholder a lower premium payment than they would if they knew the truth.

What Happens When Misrepresentation On a Life Insurance Policy Gets Discovered

Life insurance companies “rescind” life insurance coverage if they discover that the policyholder misrepresented themselves in their initial application for life insurance or their medical questionnaire. A rescinded life insurance policy gets treated as if it never existed.

How Misrepresentation Leads to Policy Claim Denials

When life insurance companies rescind a policy because the policyholder misrepresented themselves on the initial application for life insurance or medical questionnaire, it is as if the policy never existed. A life insurance company will deny a beneficiary’s claim for death benefits on a rescinded policy.

Premium payments are based on the likelihood the policyholder will die within the policy term. Those at more risk pay higher premiums than those at less risk. Life insurance companies assess policyholders’ risk of dying within the policy term based on the information they provide in the initial application and medical questionnaire.

As a matter of public policy, life insurance rescission is intended to deter life insurance applicants from lying or omitting facts on their application to get a lower premium payment.

Examples of Material Misrepresentation

Example #1: Peter intentionally lies about not smoking on his life insurance application, He dies from lung cancer. The life insurance company rescinds the policy and the beneficiaries get nothing.

Example #2: Pauline dies of a heart attack. The coroner says she died of a heart attack due to coronary artery disease. Pauline did not disclose her coronary artery disease on her initial application or medical questionnaire because she did not know she had it. The life insurance company rescinded the policy due to alleged misrepresentation and denied her beneficiary’s claim for death benefits, but the beneficiary’s attorney was able to show that Pauline had no knowledge of her condition. The beneficiary got the payout.

Example #3: Phil lies about his age on the life insurance application knowing he will get a lower premium. He dies and the life insurance finds out his true age from the death certificate, rescinds the policy, and denies his beneficiary’s claim for the death benefits. 

Example #4: Phryne mistakenly transposes her birth year from 1968 to 1986. She has dyslexia, which she does disclose. She dies, and the life insurance company rescinds the policy and denies her beneficiary’s claim for death benefits. The beneficiary’s attorney fought back and was able to show that the mistake was not intentional and therefore not fraud or misrepresentation. The life insurance company paid Phryne’s beneficiary the death benefit minus what she would have paid in premiums had the life insurance company known her true age.

Example #5: Pearl dies in a skiing accident while on the black diamond trail. Pearl failed to disclose that she was a skier on her life insurance application. The life insurance company rescinded the policy and denied her beneficiary’s claim for death benefits. 

When a Life Insurance Agent Makes a Misrepresentation

Unfortunately, life insurance agents’ mistakes in filling out applications for their clients often cause the life insurance company to rescind a policy for misrepresentation and deny beneficiaries’ claims.

For example, if a life insurance agent mistypes something, or ignores an obvious medical condition such as when their client uses a walker or a wheelchair, that mistake or omission is not the fault of the policyholder. In these cases we can get our client beneficiaries paid!

How a Life Insurance Lawyer Helps Your Case

Often, a mistake or omission is not material, in that it has nothing to do with the death of the policyholder, or it is not misrepresentation, meaning that it was an innocent mistake, the agent make the mistake, the question was confusing, or the policyholder had no knowledge of the missing or incorrect fact.

Our life insurance lawyers know the law in every state in the nation. We know that when the mistake or omission was not the fault or the intent of the policyholder, we can get our clients paid. We investigate thoroughly and uncover the truth for our clients. 
If your claim was denied due to alleged misrepresentation, we will do that for you, too. Call us for your free, no-obligation consultation. Know that we only take cases on a contingency basis to minimize costs to you, and that we only get paid when you do!

drugs

Can a Life Insurance Claim Be Denied Due to Drug Use?

The short answer is yes, a life insurance claim may be denied due to drug use, but you can fight it! Whether your denied claim for death benefits can be paid eventually will depend upon the factors explained in this article.

We have helped many beneficiaries across the nation get death benefits when the life insurance company initially denied their claims because illegal or prescription drugs were involved. If your life insurance claim was denied due to drug use or for any other reason, give us a call. We can help you appeal your life insurance claim denial.

If you or someone you know is abusing drugs or suffers from drug addiction, call the Substance Abuse and Mental Health Services Administration (SAMHSA) hotline at 1-800-662-HELP (4357) for free and confidential help, 24 hours a day.

What If the Insurance Company Claims the Drug Overdose Was a Suicide?

Most life insurance policies are subject to the 2-year contestability period, during which life insurance companies can deny beneficiaries’ claims for a number of reasons, including when the evidence suggests that the insured committed suicide. This policy is in place to keep people who intend to commit suicide from taking out life insurance policies just before their death.

Group life insurance policies from one’s employer are governed under ERISA, and in recent years the federal courts have ruled in favor of life insurance beneficiaries when the insured died of a drug overdose, deeming that the death a payable accident. In the courts’ views, the insured intended to ingest the prescribed or illicit drug, but did not intend to fatally overdose, therefore the insured did not intend to commit suicide.

Whether this theory applies in non-ERISA policies is being determined now in states across the nation. As the most experienced life insurance attorneys, we often use these and other arguments to get our clients paid. 

If you or someone you know is struggling with thoughts of suicide, call the National Suicide Prevention Hotline at 1-800-273-8255 to access their national network of local crisis centers that provide free and confidential emotional support to people in suicidal crisis or emotional distress 24 hours a day, 7 days a week.

Case Study #1

We got clients in Kansas paid when the insured died from a Fentanyl overdose. The autopsy report stated that the cause of death was “accidental.” The insured was prescribed Fentanyl patches and took them daily for several years, yet the life insurance claim was denied based on the drug use exclusion. Because the Fentynol was prescribed, and the overdose was deemed accidental, we were able to get our clients paid. 

Claims of Misrepresentations on the Life Insurance Application

If the insured used drugs and did not disclose that on their life insurance application and medical questionnaire, beneficiaries’ claims are denied due to the insured’s misrepresentation. This is the case whether the death of the insured was drug-related or not, and whether the insured died using drugs that were prescribed or illicit drugs.

Case Study #2

We recently got clients in Georgia paid when the insured, in response to the question “In the past three months, have you consulted a doctor or had treatment, medication, or diagnostic tests of any type?”  answered “Yes” and added, “Taking Nexium 40mg for Acid Reflux.” 

New York Life denied her beneficiaries’ claim due to alleged misrepresentations, asserting that the insured was diagnosed with dyspepsia, gastroesophageal reflux disease with esophagitis, gastritis, and helicobacter pylori, weight loss, was taking Nexium, Biaxin, Zantac, and Flagyl, and was recommended to have an upper endoscopy. 

We successfully argued that the life insurance company was on notice from day one that the insured had a condition that should be investigated further before writing a policy, but the insurer failed to do so, and so waived their defense of misrepresentation. 

What If the Cause of Death Was Unrelated to Drug Use?

If a toxicology report shows the insured took prescription drugs they did not disclose, or took illicit drugs triggering the policy’s drug exclusion, the insurance company will most likely deny claims for death benefits initially. However, if the cause of death had nothing to do with drugs, we may be able to get the beneficiary paid.

Case Study #3

The insured was in a motorcycle accident, sustained severe injuries, and was hospitalized with a DNR for one month until he died. His beneficiary’s claim was denied based on “acute amphetamine intoxication” and benzodiazepine use, both of which were indicated in the toxicity report. No autopsy was performed, and the medical examiner never viewed the body. 

We successfully argued that the insured did not die from an overdose but from injuries sustained in the accident, and we got our clients paid.

Case Study #4

The life insurance company denied our client beneficiaries’ claims due to misrepresentation on the part of the insured. However, the alleged misrepresentation was not material to the insured’s death, which was from natural causes. We got those clients paid, too. 

Drug Exclusions in the Rider

Most accidental death insurance policies include exemptions for death by drug overdose. The rub is that while death by prescription drug overdose is commonly deemed to be accidental, these insurance policy claims get denied. Even if the death certificate lists the cause of death as “accidental” when someone dies of a drug overdose, insurance companies will deny those claims. 

The insurance company will often use an autopsy report or toxicology report to determine whether a life insurance claim should be paid, but the mere presence of a drug in the insured’s system does not mean that the death was not accidental. Did the insured know they were taking a drug, or that the drug they took had a fatal interaction with another drug they take? Was the insured mistaken as to the dose? Was there perhaps medical malpractice in prescribing too large of a dose, or in prescribing a drug that could have fatal interaction with a drug the insured was already taking? Did the insured use marijuana legally or as a prescription, and your claim was denied?

We investigate the death of the insured when the insurer uses drugs as an excuse to deny your claim for death benefits. We get to the truth!

What You’ll Need to Fight Your Life Insurance Claim Denial

If your claim for death benefits was denied due to alleged drug use, talk with us. When you have your no-cost, no-obligation consultation with us, we will tell you in advance what documents you should provide. They may include:

  • A copy of the life insurance policy
  • A toxicology report
  • An autopsy report
  • A death certificate
  • The names of any doctors seen by the insured
  • The name, dose, and date of any prescription drugs that the insured may have been taking.

We Fight Back When Life Insurance Companies Use Drug Use as an Excuse Not to Pay You

While we cannot guarantee the result of any case, and cannot promise the same results as the case studies in this article, we can promise you that your case will get the full attention that it deserves. We appeal life insurance claim denial on contingency, meaning that we never get paid unless you do. If you retain us to fight on your behalf, know that we expect to win! Contact us immediately to talk about your death benefit claim denial.

Insurance claim denied graphic

What is “Material Misrepresentation” in Life Insurance?

Life Insurance Misrepresentation defined by a national life insurance beneficiary attorney.

Material misrepresentation is an untrue statement or omission that affects an insurer’s decision whether to issue a life insurance policy, and if issuing the policy, what premium the insured will pay. Usually the omission or untrue statement is meant to work in the insured’s favor, making the insured seem like less of a risk to the insurance company..

The two year period after the insurer issues a life insurance policy is called the “contestability period.” During the contestability period, the insurer has the right to rescind a life insurance policy if, after an investigation, it finds that the insured made a mistake or lied on the initial application and medical questionnaire. 

In virtually every state in the U.S., our attorneys have been very successful in getting clients’ claims paid when they were initially denied due to alleged misrepresentation on a life insurance application or medical questionnaire. Call us at 1-855-865-4335 to discuss your case. We don’t get paid unless you do!

What is Rescission in Life Insurance?

When insurers deny a beneficiary’s claim due to alleged misrepresentation on the part of the insured, they are exercising their right to “rescind” the policy, meaning, they never would have written the policy but for the insured’s untrue statement or omission. The policy is deemed void ab initio, which means it is treated as invalid from the outset.

When Can an Insurer Rescind a Life Insurance Policy?

An insurer can rescind a life insurance policy when the insurer can show any material misrepresentation on the part of the insured. The insurer’s burden of proof varies by state.

Some common defenses to an allegation of material misrepresentation are:

What if there was No Intent to Deceive on the Part of the Insured?

It depends where the insured took out the policy. Many states allow an insurer to rescind a life insurance policy and deny the claim even if there was no intent to deceive on the part of the insured. Those states do not differentiate between an honest mistake and a lie, and rescission can happen whether the death occurred within the contestability period or not.

Case Study: in South Carolina, a death benefit claim was denied for misrepresentation about COPD, however, the insured was never diagnosed with COPD.  South Carolina law requires proof that (1) the insured’s statement was false; (2) the falsity was known to the insured; (3) the falsity was material to the risk; (4) the falsity was made with the intent to defraud the insurer; (5) the false statement was relied on by the insurer. False answers made to the best of insured’s knowledge and belief does not satisfy the element of intent. We got our client beneficiary paid.

Case Study: in Illinois, an insured disclosed all medical information, including a hospital trip and follow up visits. The agent prepared the application. When the insured died, the insurer denied the claim for death benefits because the agent had neglected to record the insured’s disclosures completely. Under Illinois law, misrepresentation requires actual intent to defraud. Because the insurer cannot use fraudulent, careless, negligent, or mistaken actions of an agent to avoid payment, we got our client paid.

What if the Alleged Misrepresentation Had Nothing to Do with the Cause of Death?

In some states, an insurer will rescind the policy even if the alleged misrepresentation had nothing to do with the cause of death, even if the contestability period expired. We have gotten our beneficiary clients’ claims paid when the alleged misrepresentation was not “material” to the cause of death.

Case Study: in Kansas, an insured died of natural causes but the insurer tried to rescind the policy due to incorrectly-answered questions on the questionnaire. Under Kansas law, an insurer can only rescind a policy if it proves that the insured made an untrue statement or omission of material fact with the intent to deceive. In order for a misrepresentation to be material, it must have directly contributed to the insured’s death. Because the insured died due to natural causes, we got our beneficiary client paid.

Case Study: in Maryland, an insured and his fiance completed a life insurance application via agent with five people present and the insured was never asked about drug abuse. Insured was later murdered. An insurer has the burden to prove fraud and materiality of misrepresentation. Although the insured did not disclose drug use, he was not asked about it and did not receive medical treatment for it. Because the drug use was not material to the death and the insured was not asked about it, we got our client paid. 

Wondering if drug overdose is an accidental death covered by life insurance? It can be. Call us if your life insurance claim was denied because of drug overdose.

If you or someone you know is abusing drugs or suffers from drug addiction, call the Substance Abuse and Mental Health Services Administration (SAMHSA) hotline at 1-800-662-HELP (4357) for free and confidential help, 24 hours a day.

What if the Life Insurance Agent Made the Misrepresentation?

We have seen many, many cases where the agent or broker completed the application and medical questionnaire for the insured, and either made a mistake or intentionally omitted a fact.

In these cases, we have argued successfully that knowledge of the disputed fact is imputed to the insurer through the actions of its agent, and that there was no intent to deceive on the part of the insured.

Case Study: in Georgia, a life insurance agent completed the application for the insured indicating that the insured had no material medical history at all, although the insured was confined to a wheelchair and visibly had an amputation of lower extremities. Because actual knowledge of the agent’s incorrect statements in the application is imputed to the insurer, we got our beneficiary client paid.

Case Study: in New Mexico, an insured had cancer 15 years earlier and disclosed to the insurance agent that she visited an oncologist every six months. The agent did not disclose this on the application for life insurance. When the insured died, the insurer tried to rescind the policy due to misrepresentation, but we got our beneficiary client paid because information conveyed to the agent is imputed to the insurer.

Case Study: in Oklahoma, an employer switched the company’s group policy to another insurer, and the insured was asked only if she wanted the same coverage, which she did. After she died, the new insurer claimed misrepresentation because the insured did not disclose her full medical history. However, the new insurer did not require the insured to complete an updated medical questionnaire at the time. We got our client beneficiary paid.

Case Study: in New York, an applicant who was blind and had diabetes had an agent fill out the life insurance application. The agent marked “No” for both conditions. When the insured died, the insurer sought to rescind the policy for misrepresentation, but because the insured was blind she could not have seen the application. We got our beneficiary client paid.

When the Insured Would Have Paid More in Premiums but for the Alleged Misrepresentation. 

People who are older or who have existing medical conditions or previous surgeries will pay more in premiums because they present more of a risk of loss to an insurer. If a person lies about age or medical history on their application, the insurer will charge less in premiums but may have the right to rescind the policy if they discover the misrepresentation.

Case Study: the application listed the insured’s age as seven (7) years younger than he was. When he died, the insurer tried to rescind the policy due to misstatement of age. This policy was governed by Delaware law, and the solution was to settle for most of the death benefit amount by calculating what premiums the insured would have paid if the insurer knew his correct age, and subtracting that amount from the death benefit.

Ambiguous Questions on the Questionnaire Resulted in Misrepresentation.

If a question on a medical questionnaire is ambiguous, it and the insured’s response can be construed against the insured. Often a question will prompt an incomplete answer or an answer that puts the insurer on notice that there may be more to the story.

Case Study: In response to  “In the past 3 months, have you consulted a doctor or had treatment, medication or diagnostic tests of any type?” the insured answered “Yes.” Underneath the question, the insured added, “Taking Nexium 40mg for Acid Reflux.” When she passed, the insurer denied the beneficiary’s claim due to alleged misrepresentations, asserting that insured was diagnosed with dyspepsia, gastroesophageal reflux disease with esophagitis, gastritis and helicobacter pylori, weight loss, was taking Nexium, Biaxin, Zantac and Flagyl, and was recommended to have an upper endoscopy.

Under Georgia law, the existence of circumstances from which constructive knowledge of material information may be imputed to the insurer will estop the insurer from relying upon the falsity of such answers in seeking to avoid liability under the policy. The insured made no further inquiry, therefore it was no failure of the insured to disclose. Also, under Georgia law, courts have consistently found that compound questions to be answered with a “Yes” or “No” are ambiguous by law, and ambiguities are always be construed in favor of the insured.

Case Study: in New Hampshire, a family took out a life insurance policy. The application had room for five names, but only two doctor’s names, so it was unclear to the parents whether the medical questions applied to the children or not. Questions are ambiguous when there are two reasonable interpretations, and because ambiguous questions are interpreted in favor of the insured, we got our client paid.

Case Study: in Arizona, an agent prepared a life insurance application for an insured and her son. She only spoke Spanish, and several questions on the application were ambiguous in that it was not clear whether facts or an opinion regarding the son’s health were sought. The son later died. Because in Arizona an insurer must prove actual fraud to rescind a policy for misrepresentation, we got our client paid.

What if the Insured’s Answers Should Have Triggered Investigation by the Insurer?

In some states, an insurer has a duty to investigate if any answers on the insured’s application or medical questionnaire indicate there may be more to the story.

Case Study: in New Mexico, an agent completed an application for the insured and the insured stated that she reviewed the application and approved it. Although she did not disclose any medical conditions, that day she was using an oxygen tank and, in fact, had been diagnosed with congestive heart failure, atrial fibrillation, and diabetes. The agent failed to take note of this and his failure to disclose facts that may affect the insured’s interest makes him liable for the loss. The insurer has a duty to investigate when an applicant gives sufficient information to alert the insurer to a medical condition. Because the agent failed to warn the insurer of an observable health condition, the insurer could not rescind the policy and we got our client beneficiary paid.

If Your Claim Has Been Denied Due to Material Misrepresentation, Talk with us – our lawyers are among the Best Life Insurance Beneficiary Attorneys in the United States.As you have read, in many states beneficiaries can successfully defend against insurance companies’ allegations of material misrepresentation. Regardless of where you live or what state law controls, you need vigorous representation to get paid. Contact us for a free case evaluation.  You pay no fee unless we get you paid. 
shots of alcohol

Life Insurance Claim Denied Due to Alcohol Consumption?

Can the life insurance company deny your claim because the insured used alcohol? The short answer is yes, claims for death benefits are frequently denied unfairly when alcohol is involved.

Was your claim for death benefits denied because the insured used alcohol? Was the insured’s death from complications from alcohol abuse? Was the insured intoxicated when they died, but their death had nothing to do with alcohol use or abuse?

In many cases where the life insurance company denied beneficiaries’ claims due to the insured’s alcohol use, we can help you get your claim paid by appealing the life insurance claim denial. Let the experienced life insurance beneficiary attorneys at Boonswang Law fight for you. There is no cost unless we win.

If you or a loved one is struggling with alcohol abuse, call the Substance Abuse and Mental Health Services Administration (SAMHSA) hotline at 1-800-662-HELP (4357) for free and confidential help, 24 hours a day.

Why Insurance Companies Routinely Deny Life Insurance Claims Due to Alcohol Consumption.

Insurance companies make money for their shareholders when they deny life insurance claims. For this reason, they will grasp at any reason, however unlikely, to deny your claim initially.

Does Alcohol Affect Life Insurance?

Yes, alcohol consumption can affect whether a life insurance policy is paid, or whether an applicant for insurance can get coverage.  

If an insured discloses on their initial application for life insurance that they use alcohol, the insurance adjuster will take that into consideration when writing the policy. Life insurance companies often justify their life insurance claim denials by arguing that alcohol use can affect the amount in premiums an insured will pay, and may even result in denial of their application.

Will Life Insurance Pay Out for an Alcohol-Related Death?

In some cases, life insurance will pay out after the death of an insured who suffered from alcoholism. If the insured died of causes wholly unrelated to alcohol use or abuse, it is often possible for an attorney to get that life insurance claim paid.

What Can Be the Reasons for Rejection of a Death Claim Due to Alcohol?

Here are the types of death not covered by life insurance when alcohol is involved:

The Policy has an Alcohol Intoxication Exclusion

In about half of all states in the U.S., life insurance companies are permitted to add an exclusion to policies to exclude deaths directly or indirectly related to alcohol use from coverage. If the insured is intoxicated and dies for any reason, the insurance company will deny your claim under this exclusion.

Misrepresentation on the Initial Application and Medical Questionnaire

If the insured omits mention of alcohol use, or fails to disclose past or current alcoholism, and the death of the insured was in any way related to alcohol use, the insurer will likely deny your life insurance claim for death benefits because of alleged misrepresentation on the part of the insured.

We can sometimes resolve these claims for the amount of the death benefit minus the amount the insured would have paid in premiums had the underwriter known that the insured used alcohol.

The Insured Died During the Contestability Period

If the insured dies within two years of purchasing the policy, the insurer will grasp at any reason to deny your life insurance claim, even if that reason has absolutely nothing to do with the cause of death. 

For example, if the insured failed to disclose that they used alcohol socially, and then dies of something having nothing to do with alcohol use, such as mesothelioma, the insurer may allege that the insured misrepresented himself and deny your life insurance claim.

We are frequently able to get these claims paid, especially if the death was unrelated to alcohol use or abuse.

The Insured Died While Doing Something Illegal

If the insured died while doing something illegal – for example, drinking and driving – the insurer will deny your life insurance claim under the illegal act exclusion. If the insured had a few drinks at a friend’s dinner party, mistakenly trespassed on a neighbor’s yard on the way home, and was struck by a falling branch and killed, the insurer may use the few drinks to deny your life insurance claim.

Let the Life Insurance Beneficiary Attorneys at Boonswang Law Fight for You!

If your claim has been denied for an alcohol-related reason, do not give up! There are many circumstances under which we can get that claim paid or even negotiate a settlement for you.  Keep in mind that we take cases on a contingency basis, meaning that we do not get paid unless we win. Contact us for your free, no-obligation consultation. Let us help you fight the life insurance company.

smoke

Life Insurance Claim Denied Due to Smoking?

Unfortunately, one of the most common reasons insurance companies refuse to pay a life insurance claim is because the insured smoked, but did not disclose their past or current smoking habit on their initial life insurance application and medical questionnaire.

If your claim was denied due to smoking, we can help. Often it is a matter of showing that there was no fraudulent intent on the part of the insured, or that a past smoking habit had nothing to do with the insured’s cause of death. 

Don’t take no for an answer if payment was denied because the insured allegedly lied about smoking. The experienced life insurance lawyers at Boonswang Law have helped thousands of beneficiaries get paid when the insured was a smoker by appealing the life insurance claim denial. Contact us for your free, no-obligation case evaluation. We don’t get paid unless we win, so let us help you.

Claim Denied Due to Death within the Contestability Period

The two-year period following the date of purchase of the life insurance policy is called the contestability period. During the contestability period, an insurer can deny beneficiaries’ claims for any mistake or omission they made on the initial life insurance application or medical questionnaire, even if the mistake or omission had nothing to do with the insured’s death.

For example, if the insured did not disclose that they had a smoking habit years ago, and quit, then died of injuries sustained in a car accident during the contestability period, the insurer can deny your claim. If the insured failed to disclose that they currently smoke, and was shot and killed in a hunting accident, the insurer can still deny your claim.

When the alleged misrepresentation is not “material” to the insured’s cause of death, we can often get your claim paid.

Claim Denied Due to Misrepresentation

If the insured died outside the contestability but the cause of death could be linked to undisclosed smoking, your life insurance claim will likely be denied due to misrepresentation. The reason insurers are permitted to deny such claims is that as a matter of public policy, people applying for life insurance should be dissuaded from lying about their health or lifestyle habits just to get a lower premium payment.

We have gotten many such claims paid because we can show that the insured did not act with fraudulent intent in failing to disclose smoking. We have also gotten claims paid when the insured’s smoking habit had nothing to do with the cause of death.

Case Study – If No Intent to Deceive, No Misrepresentation

Where an insured died of natural causes but the insurer denied the claim because questions on the initial application were not answered correctly, we were able to get that claim paid because those answers did not show that the insured acted with the intent to deceive, and the answers were not material to the insured’s cause of death.

Claim Denied Due to Agent Mistake or Negligence

It is all too common for an insurance agent to complete an application and medical questionnaire on behalf of the insured, to make a mistake that the insured does not find or know about, and then for the insurer to deny beneficiaries’ claims due to alleged misrepresentation on the part of the insured.

Case Study – Settling for the Death Benefits Minus the Increase in Premiums the Insured Would Have Paid.

An agent made a mistake that recorded the applicant’s age as seven years younger than he was. We were able to get our beneficiary client paid the death benefits minus the amount the insured would have paid in premiums had his age been recorded correctly. This same theory might apply to get you paid when the insured smoked, but did not disclose it on the application. 

Case Study – Agent Negligence or Mistake.

An insured disclosed to his agent that he used to smoke but quit a few months prior. His agent responded that the question about smoking did not apply because the insured had recently quit. The agent also did not record related information about the applicant’s COPD and Hepatitis C. The insured signed the application verbally and did not have a chance to proofread the agent’s work.

Although the insured died from smoking-related complications, the agent knew about past smoking and present related conditions yet did not record them. We got our client beneficiary paid because the insurance agent’s knowledge is imputed to the insurance company.

Don’t Take No For An Answer! We Can Help Get You Paid When the Insured Smoked

The life insurance beneficiary lawyers at Boonswang Law have dealt with thousands of claim denials over the years, and smoking has figured prominently among the reasons for denying a claim. What might seem like a cut-and-dried case of lying on the part of the insured may be an innocent mistake, a mistake or negligence by the insurance agent, or have nothing to do with the cause of death. In any case, we will find out and help you fight back. 

Have questions about life insurance claims being denied due to vaping or occasional cigar smoking? We can help you with that too. Call us and find out how to appeal your life insurance claim denial.

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Life Insurance Company Won’t Pay Claim? Here’s What to Do When Your Claim is Denied

Here’s an explanation of the most common reasons a life insurance company refuses to pay a claim, how you can prevent your beneficiaries’ claims from being denied, what to do if the life insurance company denies your claim, and how to appeal your life insurance claim denial, from the noted life insurance lawyers at Boonswang Law.

Why Do Life Insurance Companies Deny Claims?

Life insurance companies seize any opportunity to deny claims because they only make money for their shareholders when they don’t pay out. This means that many, many claims are denied in bad faith, for the flimsiest of reasons.

5 Common Reasons for Life Insurance Claim Denials or Delays

Death During the Contestability Period

The two years after the day that the insured purchases a life insurance policy is called the contestability period. During the contestability period, the insurance company can deny a claim for death benefits due to any mistake or omission on the insured’s initial application and medical questionnaire, even if the mistake has nothing to do with the cause of death.

Suicide during the contestability period will also result in claim denial. This is to dissuade those contemplating suicide from taking out life insurance policies to benefit their loved ones, knowing they will die soon.

If you or someone you know is struggling with thoughts of suicide, call the National Suicide Prevention Hotline at 1-800-273-8255 to access their national network of local crisis centers that provide free and confidential emotional support to people in suicidal crisis or emotional distress 24 hours a day, 7 days a week.

Misrepresentation on the Application or Medical Questionnaire

If the insured intentionally or mistakenly omits or misstates information of any kind during the contestability period, the insurer will deny your claim. This is also true if the omission or misstatement was made by an insurance agent preparing the insured’s application and medical questionnaire.

Insurance companies will also deny claims outside of the contestability period for alleged misrepresentation, whether or not the alleged misrepresentation had anything to do with the insured’s cause of death. These denials can frequently be overturned!

Death Excluded from Coverage

Common exclusions include:

  • Suicide (often if within 2 years of taking out the policy)
  • Death during an illegal act
  • Death by drug overdose
  • Death by alcohol poisoning
  • Death occurring while visiting a high-risk travel destination
  • Death due to an Act of War

If you or someone you know is abusing alcohol or drugs call the Substance Abuse and Mental Health Services Administration (SAMHSA) hotline at 1-800-662-HELP (4357) for free and confidential help, 24 hours a day.

Lapsed Policy Due to Non-Payment of Premiums

If a beneficiary is told that the claim is denied due to policy lapse or termination, the inquiry should not stop there. It is common for policies to lapse due to no fault of the insured. 

For example, if an employer fails to pay group life insurance premiums on the insured’s behalf and then fails to provide the required notices and conversion forms to the insured, the employer is at fault for the lapse in coverage and the claim can be paid.

If an insurance company cannot show that it sent the insured the required notices of impending lapse, the claim can be paid. If the insured was entitled to a waiver of premiums due to disability, but did not receive that waiver, the claim can be paid.

Beneficiary Dispute 

If the insured changed the beneficiary designation just before dying, or there is an allegation of fraud or undue influence related to a change of beneficiary, the insurer will not pay out until that is resolved.

If the insured is vague in the beneficiary designation, for example, designating “all my children” rather than naming each of the children, a beneficiary dispute may arise. Did he mean all of his children from all marriages? Did he intend to include children born outside of his marriages? Did he intend to include stepchildren? The insurer will not pay out until this is resolved.

If the insured’s named beneficiary cannot be found or has died, and there is no contingent beneficiary, the insurer will investigate and will eventually pay the death benefit to the insured’s estate.

How to Prevent Claim Rejection

An insured can take these three (3) steps to make sure their intended beneficiaries get the death benefit they’ve paid for.

  1. Disclose Medical History and Lifestyle Habits

The insured should disclose all past and current medical conditions, diseases, surgeries, and medication. The insured should also disclose all lifestyle habits, such as smoking and alcohol use. If the insured engages in any activities or hobbies considered dangerous by the insurer, the insured should disclose that as well.

If the insured hides any of these facts, they risk their beneficiary’s claim being denied for misrepresentation, especially if the insured dies within two years of purchasing the policy or the cause of death is related to the misrepresented fact.

If you or a loved one is struggling with alcohol abuse, call the Substance Abuse and Mental Health Services Administration (SAMHSA) hotline at 1-800-662-HELP (4357) for free and confidential help, 24 hours a day.

  1. Proofread Application Prepared by Agent

Frequently, errors and omissions are the fault of an insurance agent who prepared the application and medical questionnaire on behalf of the insured. The insured should always proofread these documents carefully before signing them.

  1. Specify the Name of a Beneficiary and a Contingent Beneficiary

The most effective way to make sure the death benefit will pass to the intended parties is to specify primary and contingent beneficiaries by name. Do not name a minor child as a beneficiary, as this child cannot directly receive the death benefit and the court will appoint a receiver or trustee to manage the funds.

How Do I Deal with a Rejected Insurance Claim?

Contact the Insurance Company

Be sure to get the reason for denial in writing. Ask the claims agent if any additional information or documentation would overturn the denial. 

Contest the Denied Claim

By law, you must be given the forms to contest the claim denial. You must have reasons other than “the denial is wrong” or “the denial is unfair” to overturn the denial. 

Frequently, the reason for the claim denial seems iron-clad on its face, but the facts behind the reason show that there was no fault on the part of the insured. In those cases, the claim denial can be overturned entirely, or the life insurance company will settle for the death benefit amount minus what the insured would have paid in premiums.

When Does a Life Insurance Beneficiary Need an Attorney?

As soon as your claim is denied (or even if you think your claim is going to be denied), contact a life insurance beneficiary attorney. This will not cost you anything because beneficiary attorneys work on contingency, meaning they only get paid if they win. 

An experienced life insurance beneficiary attorney will investigate the facts behind the denial and the facts of the cause of death and will be able to uncover whether the policy legally lapsed, the insured was at fault for misrepresentation, or the death was indeed excluded from coverage. Often a claim that is initially denied is paid or settled once an attorney gets involved.

Let the Experienced Life Insurance Beneficiary Attorneys at Boonswang Law Help You Get Paid

Boonswang Law has helped thousands of beneficiaries just like you contest a claim denial and get paid. Contact us today for your free, no-obligation case evaluation. Remember, we don’t get paid unless you do!

person calculating insurance claim

Delayed Payout? Life Insurance Companies May Owe Interest

If a life insurance company is delaying payment of your claim, you may be owed interest.

When an insurance company denies or delays your claim, they can continue investing the proceeds and accruing interest that would otherwise be in your pocket. The insurer may owe you that interest under certain circumstances.

To find out if you are entitled to interest on your delayed life insurance payout, contact our life insurance beneficiary lawyers. We have over 25 years of experience getting clients paid and getting clients interest on their delayed payout. We can tell you if you are owed interest during your free, no-obligation case evaluation.

How Long Does it Take to Receive Life Insurance Death Benefits, Usually?

Wondering how long insurance companies take to process claims, or how long does it take for a life insurance company to pay out? An uncontested claim for death benefits, where the death of the insured does not require investigation, is usually paid within 30 days. Most states require life insurance companies to respond to a claim within thirty days, whether that response is approval, denial, or a request for more information.

Insurance companies are required to tell claimants which of the reasons life insurance won’t pay out. And when life insurance does not pay promptly, you have a right to know why.

How Can a Beneficiary Get Interest on a Delayed Life Insurance Payout?

If an insurance company unreasonably delays its response to your claim for death benefits, you may be entitled to interest. Whether you are owed interest on life insurance death benefits depends upon the terms of the policy and the jurisdiction governing the policy. 

Some life insurance policies include a provision that entitles a beneficiary to interest after a specified delay in payout.

Many states have enacted statutes that grant interest to a beneficiary of a life insurance policy when an insurer unreasonably delays a claim determination. For example, this Iowa statute explains the circumstances that allow a beneficiary to collect interest and the rate at which the interest is calculated.

Some delays in payment of the death benefit are considered inherently unreasonable, including:

Delay in Life Insurance Payment after Claim has Been Approved

Occasionally, an insurer or a company’s agent will tell a beneficiary that a claim has been approved, but the insurer delays sending payment. The longer an insurer retains the funds, the longer an insurer is able to continue investing those proceeds and reaping the profits for its shareholders. Under these circumstances, a beneficiary may be entitled to interest.

Delay in Payment of Claim Because Life Insurance Company Does not Contact the Beneficiary

Frequently an insurance company has reason to know that an insured died but fails to reach out to the beneficiary of the life insurance policy. Often a beneficiary is unaware that they are named in a policy or that a life insurance policy even exists.

If an insurer has reason to know that an insured has died, for example, because they use the Social Security Death Master File to identify policyholders who have died, that insurer should notify the beneficiary promptly.

Recently, several states have brought lawsuits against insurance companies that knew of policyholder deaths but failed to notify beneficiaries, retaining the death benefits and the interest accruing on them instead. Under these circumstances, a beneficiary may be entitled to interest due to the unreasonable delay.

Why Would a Life Insurance Payout Be Delayed?

Payout may be delayed six to twelve months or longer if the insurance company must investigate because:

If you are a beneficiary to a life insurance policy and you’ve submitted your claim and all required paperwork but haven’t been paid, know that the insurance company has no incentive to pay you quickly. In fact, any delay means your payout is accruing interest and benefitting the insurance company’s shareholders.

In the past there were many examples of life insurance companies not paying claims without delay. Fortunately, laws have been enacted to incentivize insurers to pay life insurance claims promptly, and if they do not, they may have to pay you interest.

If you or someone you know is struggling with alcohol or drug abuse call the Substance Abuse and Mental Health Services Administration (SAMHSA) hotline at 1-800-662-HELP (4357) for free and confidential help, 24 hours a day.

If you or someone you know is struggling with thoughts of suicide, call the National Suicide Prevention Hotline at 1-800-273-8255 to access their national network of local crisis centers that provide free and confidential emotional support to people in suicidal crisis or emotional distress 24 hours a day, 7 days a week.

How Long Does a Life Insurance Investigation Take?

What is the typical timeline for insurance companies to investigate claims? It varies, depending upon the circumstances of the death. Beneficiaries should be sure to respond promptly to all information and documentation requests from the life insurance company.

After the insured has died, beneficiaries of the life insurance policy file a claim with the insurance company and include a copy of the death certificate with their claim, keeping at least one original death certificate for their records in the event that the life insurance company misplaces the one sent to them.

When the insurance company receives the claim form and a certified copy of the death certificate, insurers have 30 days to deny the claim, pay the claim, or ask for more information.

In some situations, insurers will need to investigate a claim and the payout will exceed 30 days. Depending on the terms of the insurance policy and the laws that govern the policy, sometimes a beneficiary will be entitled to interest that has accrued during the delay of payment.

If your claim has been pending for more than thirty days, whether you have heard from the life insurance company or not, contact our experienced life insurance beneficiary attorneys. We help beneficiaries nationwide get paid with interest when their claim has been unreasonably delayed. 

When Will Life Insurance Companies Investigate Claims?

In most cases, an insurer will either deny a claim or pay a claim within 30 days. When there is a delay in life insurance payout instead of denying or approving, it may mean that an insurer requires more time to investigate the claim. Delays will likely occur in the following situations:

Delay in Life Insurance Payout When the Insured Died by Homicide. 

When an insured is murdered, the insurance company often waits to pay any benefits until the investigation is completed. Depending on the type of policy in question (term life, whole life, or AD&D insurance), the insurance company may need to know whether the beneficiary is associated with the murder or whether the insured was engaged in a felony at the time of his or her death

Delay in Life Insurance Payout When the Insured Died in a Foreign Country.

If the insured dies while abroad, an insurance company may take longer to investigate the circumstances of the death.

Insurers always require proof of death when a claim is made. In the U.S., a death certificate is acceptable proof of death. However, customary practices, records, and technologies vary across countries and continents, and a foreign death certificate may not satisfy the insurance company. Also, to ensure a claim for overseas death is not fraudulent, an insurance company may attempt to confirm the circumstances of the insured’s death independently. Depending on where the insured died, this may extend the investigation period significantly.

Delay in Life Insurance Payout When there is a Beneficiary Dispute.

If the insurance company is notified that multiple parties might have a claim to life insurance proceeds, it will postpone paying the benefit until a rightful beneficiary is established. Often, the insurance company will not make this determination itself. The insurer may file a life insurance interpleader action, and a court will decide the lawful beneficiary.

Case Study #1: the insurance company delayed paying for over two years because the insured had a girlfriend and child and neither was named in his policy. Luckily for our client, Illinois law prevents such improper claim practices and unreasonable or vexatious delay in paying claims, and we were able to get our client paid.

Delay in Life Insurance Payout When the Insured Died Within the Contestability Period.

The contestability period lasts for two years. During this time, an insurer is authorized to investigate to look for evidence of fraud and misrepresentation in life insurance application and medical questionnaire. If the insured dies within this two-year period, a payout of benefits may be delayed while the insurer examines medical records, financial records, or other relevant evidence.

Delay in Life Insurance Payout When the Insurance Company Makes an Administrative Error.

Case Study #2: payment of our client’s claim for death benefits was delayed because the insurance company never received medical records from a doctor that the insured never visited.  

If your claim is denied, please get all the details you can about the reason for the denial: it may be something as simple as a mistake such as this preventing you from getting your life insurance payout.

Delay in Life Insurance Payout When the Insured Never Received Notice of Lapse or Termination.

Case Study #3: Our client’s claim was denied because the policy lapsed and terminated due to non-payment of premiums. We investigated and found that the insured never received the statutorily-required notices. We got our client paid.

What Can a Lawyer Do if a Life Insurance Payout is Delayed?

An experienced life insurance lawyer will be able to tell you whether the delay can be turned into approval and whether you are entitled to interest for the time of the delay. Do not rely on an insurance company to tell you that you are entitled to interest – they have no incentive to do so.

Our life insurance attorneys can demand and obtain the full death benefits you are legally entitled to. Again, your right to interest depends on the jurisdiction in which the policy was issued and the terms of the policy itself, and we help beneficiaries get paid in jurisdictions across the nation.

For more information about your rights to interest on a delayed payout of benefits, contact a trusted life insurance attorney at the Boonswang Law Firm with your questions. Your initial case evaluation is free of charge, and if we take your case, know that we don’t get paid unless you do.

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