FEGLI Claim Denied
Group life insurance is a unique form of life insurance in which one overarching contract covers all the members of a particular group. Usually this group has something in common, and that something tends to be employment or membership in a labor organization. In fact, the largest group life insurance policy is provided by the federal government. Their Federal Employees Group Life Insurance (FEGLI) was established in 1954 and now covers over 4 million current and retired federal employees.
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What is FEGLI life insurance?
FEGLI is a group life insurance policy that provides coverage for federal government employees and postal service workers. There are 4 types of coverage options available: basic, A-standard, B-additional, and C-family.
For those in a FEGLI-eligible position, Basic coverage begins the day your employment begins. Postal workers also receive Basic coverage for free, and the rest of eligible employees pay reduced rates for their policy. Employees who use FEGLI for their life insurance can add on additional policies and other family members to their plan.
There are a few key differences between FEGLI and other group life insurance policies and other standard life insurance providers. The major difference regards the governing body. Other forms of life insurance, both individual and group, are typically provided by private companies. They may be subject to federal and state regulations, but the private company is able to provide the detailed policies.
The governing body for FEGLI is governed by the Federal Employees Group Life Insurance Act (FEGLIA). The regulations set forth in FEGLIA trump any other state or federal regulation. The most notorious example of the effects of this jurisdiction were seen in the 2013 Supreme Court decision Hillman v. Maretta. In that case, a man had forgotten to change the beneficiary of his policy after divorcing and remarrying. Despite a state law that would allow the new wife to become the beneficiary, FEGLIA regulations provided no such statute. Because of this, the ex-wife remained the beneficiary of the $125,000 death benefit following the man’s death.
So, although these regulations are quite similar to those private companies are operating under, they also vary in intricate and complicated ways. For this reason, it is important to work with FEGLI lawyers when handling claims.
FEGLI pays death benefits to the beneficiaries of the policy once the following conditions are met by the claimant:
Form FE-6, which is a claim for death benefits, is filed
The death certificate or other proof of death is provided
Form SF 2821, which is a certification of insurance status, is filed
Typically, these claims are handled in a timely manner with little confusion. However, FEGLI does deny numerous claims. The most common reasons FEGLI will deny your life insurance claim involve not following FEGLIA regulations. These include:
Invailid or no designation of a beneficiary
No coverage provided at the time of death
Insufficient filing of documents to defend your claim
Lapsed or non payment of premiums
Partial denial - issues with optional coverage amounts and policy
The above reasons deal solely with the dictates of the policy. FEGLI claims have also denied on other grounds which typically include the cause of death:
Death or injury resulting from a suicide attempt
Death or injury resulting from other self inflicted harm
Death or injury resulting from nuclear weapons or war
Death or injury resulting from a physical or mental disability
Death or injury resulting from bacterial infection such as the common cold or the flu
Death or injury resulting from food poisoning
Death or injury resulting from ptomaine poisoning
Alcohol or drug exclusions
FEGLI is not perfect. Many times claims are denied in bad faith. FEGLI may not be aware of all the facts surrounding your case, they may have illegitimate policy details, or they may simply be manufacturing a wrongful reason to deny your claim.
Handling a denied FEGLI claim
All FEGLI claims are handled by FEGLI itself. They process, waive, and convert policies, pay out benefits, and determine eligibility for additional benefits. And so any appeal on a denied claim must also go through them as well.
It is unlikely that you are up to date on all FEGLIA regulations. So, whenever handling a denied FEGLI claim, it is important to speak with a team of attorneys who are well versed in FEGLI policies and FEGLIA regulations.
A team of trained attorneys can help you better understand the intricacies of your specific policy, the regulations that the policy is subject to, and the details of your case. They can help you formulate a plan to win your case. This typically involves a thorough investigation of your specific case and similar cases that have already been decided. FEGLI lawyers can help you collect expert testimony and key data or recreations of events to support your case.
Even if you do not have a denied FEGLI claim, FEGLI lawyers can help you with other issues involving your FEGLI life insurance policy. These may include:
Ensuring that your FEGLI is up to par with current regulations to avoid problems down the road.
Questions regarding the Hillman v. Maretta case and how to avoid running into similar problems.
Questions about different FEGLI coverage options
Issues with accidental death or dismemberment and your FEGLI policy.
Issues with other optional coverage policies.
Questions regarding FEGLI forms such as FE-6 or SF 2821
Questions on how to properly file your claim from the start
Major life events that may affect your FEGLI policy such as a marriage, divorce, pregnancy, adoption, moving or changing jobs
How to change your coverage options
If you are facing a denied FEGLI claim or you just have questions regarding your policy, contact our FEGLI life insurance lawyers to help. Call or click today to get connected.
Denied FEGLI Claim
More than 4 million hold some form of Federal Employees Group Life Insurance (FEGLI) plan. These plans are offered to federal employees and those that are retired from federal employment. A FEGLI policy provides a death benefit to named beneficiaries in the event the insured passes away. Although the idea of a FEGLI plan seems simple enough, the issues surrounding the payment of the death benefit can be complicated.
Since FEGLI plans are administered by a private insurance company, finding ways to deny a death benefits claim is an ordinary part of business for the company in ensuring that only valid claims are paid out. Due to this reality, you must understand what basis an insurer can rely on in issuing a denial and how you may be able to contest this denial to ensure that you or your loved ones are provided the death benefit that is deserved even when an insurance company says otherwise.
Locate And Read The Policy
The first step in understanding the breadth of the coverage a FEGLI plan provides is to know where you can locate the full insurance policy. Due to the confidential nature of FEGLI plans, it is often required that one centralized officer or individual controller maintains possession of the information concerning the plan. This centralization attempts to control who can access the details of the plan and for there to be uniformity in ensuring that each plan member receives consistent information regarding what benefits may be available.
As a participant in a FEGLI plan, you have a right to access this information. A written request for the entire policy will allow you to gain access to the plan's details and a description of what exclusions the policy may have that could raise issues should a claim be made in the future.
Reading an insurance policy is likely not the most enjoyable task in your day, but it is necessary. The knowledge you gain from the policy will ensure that you are prepared to address specific issues that may cause a denial of coverage. If there are questions about what scenarios may result in a rejection, it is crucial to clarify these scenarios in writing so that they may be used later on to refute a change in course from your insurer.
The Typical Reasons For A Denial Of A FEGLI Claim
There is a wide range of reasons that an insurer can deny a FEGLI claim. Although this list is not exhaustive, some of the most common denial reasons are:
● Denial based on a dispute between beneficiaries of who is entitled to the benefit.
● Denial based on the named beneficiary being considered invalid.
● Denial based on the lack of a named beneficiary.
● Denial based on more than one claimant issuing a claim for the benefit.
● Denial based on questions as to valid eligibility.
● Denial based on an insurer claiming that no coverage existed at the time of death.
● Denial based on a lack of sufficient documentation to support the claim.
● Partial denial of a claim due to conflicting coverages.
● Denial based on a failure to stay current on insurance premiums
FEGLI insurance coverage can also be denied based on the cause of death. Under particular policy language, insurers can deny coverage if the cause of death was the result of:
• DUI related death.
• Death based on alcoholism.
• Death due to the abuse of illicit and illegal drugs.
• A death benefit can be denied to the beneficiary if it is found that the beneficiary was responsible for the insured's death.
What Do I Do If MY FEGLI Claim Is Denied?
Find The Policy Language
The policy language will provide specific rights to the insured and their beneficiaries if a benefit is denied based on what the insurer perceives as an event that is exempt from coverage. As listed above, there is a wide range of reasons an insurer can deny coverage. Even the specific exemption language itself is often vague enough to open the door for an insured to argue that the exemption language's intent meets the criteria for denial even if the actual language does not.
The first step in preparing your appeal of a denial of coverage is to read the policy to verify that the insurer has a valid basis for the denial based on the policy language itself. An insurer cannot merely deny coverage without providing a sufficient reason. The insurer must point to language in the policy that sufficiently supports their issuance of a denial. Reading not only the language cited in the denial letter, but also gathering further context to the rejection by reading the other provisions of the policy, is an essential first step in ensuring that you fully understand the basis or lack thereof of the denial.
Is There Conflicting Evidence That Refutes The Denial?
Although an insurer may have a basis for a denial based on the information they have in their files, this does not mean that the investigation has been completed thoroughly. Frequently, an investigator for the insurer will miss or ignore certain information that can be useful in providing a basis for the payment of death benefits. Although it should not be the beneficiary's responsibility to bring this information fully to light, the burden often falls on them to provide sufficient evidence to place into doubt the insurer's initial determination.
This evidence can be presented in a wide variety of ways; Through witness testimony, presentation of documents as well as arguments that the policy language does not, in fact, support the assertion of the insurer.
By providing a clear and concise argument, not only may you convince an insurer to change their determination, but, in the event they hold fast on their position, you may be able to lay the proper groundwork for a successful legal challenge in court.
Never Assume A Denial Of A FEGLI Is Valid Simply Because An Insurer Says It Is
Each year, there are numerous cases where a judge or jury determines that the insurer did not have a sufficient basis for denying coverage of an event triggering a FEGLI claim. By understanding your coverage language and presenting a thorough, well-thought-out argument based on evidentiary support, you can push back against unjust denials and earn the coverage that you and your family deserve.
Federal Employees Group Life Insurance, FEGLI, claims are very different than most life insurance claims, and there are different laws that control these claims. The Federal Employees Group Life Insurance Act, as known as FEGLIA, is the starting point. The Act, signed by President Eisenhower provided for group life insurance for most federal employees, and it is the largest group life program in the US with over four million federal employees, retirees and family members, as well as NASA employees.
- FEGLI Beneficiary Change
A FEGLI beneficiary change form must be signed in front of 2 witnesses, who also sign the form to be submitted and approved by the Office of Personnel Management, OPM, before the death of the insured. There are many issues that come up with respect to the change form. Our lawyers have won these beneficiary disputes one hundred percent of the time.
- No FEGLI Designated Beneficiary
The laws governing FEGLI claims are complex, and rather convoluted, and disputes arise from beneficiary designations. Typically, the money is first paid to the widow / widower, if none, then to the parents, if none, to the administrator or executor, if none, to the next of kin.
- FEGLI Beneficiary Change and Divorce
FEGLI claims can be complicated if there has been a divorce. There are conflicts of law to resolve, and state community property laws often conflict with federal laws that may preempt the state laws.
- Recent Cases
We had a client who was the wife of a civilian employee of the federal government, and MetLife under the FEGLI program failed to pay the death benefits to our client, which included a $300,000 policy, as well as a $100,000 AD&D accidental death policy. We were able to get the full $400,000 paid to our client with interest.
There was a divorce decree which specified that life insurance was supposed to be maintained on the first wife, and she claimed that she was entitled to the benefits. Our client, the second wife, came to us to fight this. We were able to resolve this, and get our client the full amount of policy.
We had a client that came to us with a FEGLI beneficiary dispute. The deceased individual’s new wife claimed that a form was signed, sent in, and accepted, and that she was the new and primary beneficiary to this FEGLI life insurance policy. Our FEGLI lawyers were able to argue this new beneficiary change was invalid, and our client got the full amount of the FEGLI policy.
We had a case in which the deceased spouse didn’t change the designation of the first wife. This was another case in which we had a state statute in conflict with a right and procedure under FEGLI. Issues included whether a right as asserted conflicts with express terms of federal law, whether the consequences injure the objectives of the federal program, and whether the equitable cause of action with respect to state law stands as an obstacle to FEGLI. We were able to get our client the full FEGLI policy.
An assignment of rights of a FEGLI life insurance policy by the children to the new wife was contested by the first wife, and our denied FEGLI claim attorneys were able to get our client, the new wife, the full policy amount.
Another recent case was an interpleader action in which the deceased put his second wife as the beneficiary of his FEGLI life insurance policy, and the first wife contested it. We got out client, the second wife, the full policy amount in less than a week.
A FEGLI claim was denied due to the wrong beneficiary change form sent in. We were able to quickly resolve this within a couple weeks for our client.
We had a denied FEGLI case in which the wife was trying to get a constructive trust set up on the Federal Employee Group Life Insurance policy proceeds due to extreme wrongdoing, however, we were able to stop this, and get our client the full policy amount.
FEGLI life insurance is coverage that is governed by the Federal Employees Group Life Insurance Act, which ensures that federal employees are protected by life insurance through a group plan. The laws surrounding FEGLI life insurance are complex and difficult to understand. If a loved one who has passed away was a federal employee with a FEGLI life insurance plan, don’t let a denied FEGLI life insurance claim go uncontested. Because there are extensive regulations to contend with, consulting with an attorney who is experienced in this specific area of insurance law is essential.
FEGLI currently offers life insurance protection to over four million members, including postal employees, federal employees and their families. If you are eligible for this coverage, you were automatically given coverage when you became an employee unless you signed a waiver form. Your FEGLI insurance may also have a dismemberment clause that pays if the insured loses a limb, is blinded, loses his or her hearing and other catastrophic injuries. For those under age 45, there is additional coverage without a corresponding increase in premium. You may have also been offered the opportunity to purchase additional coverage by paying a monthly premium. It sounds wonderful – that is, until the insured individual dies and his beneficiaries learn that they are being denied the money they are entitled to. This is when it’s essential to call for a free consultation with an attorney experienced at handling denied FEGLI life insurance claims. You don’t want to fight the federal government insurance provider on your own.
Have You Provided the Necessary Paperwork?
Before any FEGLI life insurance claims are paid to beneficiaries, the insurance provider will need specific paperwork, including:
- A form FE-6, Claim for Death Benefits, from the beneficiary or beneficiaries
- A copy of the death certificate or some other form that is proof of death
- A form SF 2821, or Agency Certification of Insurance Status
After they have received the documents above, the claimant should be paid the amount the deceased was insured for. Because this is the federal government, there could be delays or requirements that slow the process of appealing a denied claim, which is why it’s so important to have an attorney to help you fight for what you deserve.
Reasons Your FEGLI Life Insurance Claim Could Be Denied
There is a laundry list of reasons why denied FEGLI life insurance claims occur so often, including:
- More than one beneficiary was designated
- The beneficiary’s eligibility is disputed
- The insured’s eligibility is disputed
- Invalid designation of the beneficiary
- The insurer claims there was no coverage when the individual died
- Insufficient documentation
- Full or partial denial of a claim because it isn’t clear what optional coverages are in place
- Denial because premiums weren’t paid in a timely fashion
Divorce and FEGLI Life Insurance
There are special circumstances surrounding FEGLI life insurance beneficiary designations that may not apply with other types of policies. When the insured has designated his spouse at the time the policy is put in place, this individual will remain the beneficiary even after a divorce unless the proper paperwork has been submitted. While many states have laws in place that ensure that the current spouse is the beneficiary of a life insurance policy even if the paperwork wasn’t done, these state laws don’t apply to FEGLI coverage. Federal law requires that the beneficiary named in the policy be the recipient, even if the couple was separated or divorced at the time the insured individual passed away.
Additional Concerns About Beneficiaries
In certain situations, the beneficiary may not be designated in a FEGLI life insurance plan. The federal laws governing these policies will automatically pay the surviving spouse if the individual was married at the time of death. If there is no spouse, the claim should be paid to the children. If there are no children, payment should go to the parents of the deceased. Problems can arise when there are stepchildren, adopted children, or other claimants who could blur the beneficiary guidelines. When there is no clear next of kin or there is an estate involved, more issues will need to be addressed.
An attorney versed in FEGLI coverage and its complexities can help you determine how to proceed if the insurance company has denied your claim. This is especially important because FEGLI life insurance isn’t governed by state law, but by federal law, which makes the situation thornier because there are strict timelines for filing an appeal or any other paperwork. There may also be limitations on what remedies can be pursued for a denied FEGLI life insurance claim.
Dealing with a Denied FEGLI Life Insurance Claim
No matter what you do in life, everyone should be allowed to be covered in case of a problematic death. You should always be able to provide for your family, or close relatives, in case you are not available to take care of them. Many people will usually go for a general policy that covers a wide range of options. However, those will usually come with quite a high premium payment each month or year. As such, some federal companies and businesses allow employees to get a Federal Employees Group Life Insurance Policy. There are plenty of pros and cons to this policy, some of which can be extremely difficult to understand. As such, we hope to bring a bit of information to this more intricate policy choice.
What is a FEGLI?
To start with, FEGLI is not your typical kind of insurance. Most groups that focus primarily on life insurance for individuals tend to help cover either partial moments in their lives, as well as entire life coverage. These are tailor made for specific individuals, and don’t usually blanket an entire company. However, the Federal Employees Group Life Insurance is generally a life insurance that helps those that aren’t able to afford the larger full life insurance policies, but still wish to be covered.
FEGLI generally help to insure federal employees with a bare bones basic life insurance policy. These policies don’t usually cover much, and are not able to be used to create cash value or any type of backing. You can get a few options that allow you to cover such things as basic accidental deaths and other such problems. This can include accidental dismemberment, and some other different options, although you have to generally ask the company for those extra options.
What are the stipulations?
There are quite a few problematic details and issues that come about when filing for the FEGLI. As it is a group benefits package, you must make sure that you are able to pass their qualifications, as well as their requirements. Many companies do rigorous background checks, as well as credit checks and the like to ensure that the employee attempting to apply for the policy isn’t going to compromise the insurance group or the company.
How can these Affect Claims?
One of the downsides to attempting to file a claim can be the problematic issue that the rules were not followed. With companies, they will attempt to find any and all ways possible to ensure that they do not have to pay out any sort of amount to the beneficiaries. As much as everyone wishes that they could keep each other in their good graces, it comes more often than not that a company must look after their own interests. To them, insurance and employee components are just a business and a form of investments. For you, it is your legacy and livelihood.
One of the most common problems that can come up that can cause a denial or delay in the claim is the cause of death. The reason for this is that FEGLI policies will almost always need to be either accidental. This is a surefire way for them to clear the problematic issue of suicides or dangerous activities, such as rock climbing or skydiving. Both of these activities are considered dangerous, sports, which would not fall under the accidental death guideline in the policy listing.
Another problem is properly naming and listing a beneficiary. Although it doesn’t seem like this should be an issue, if the policy holder did not properly list the beneficiary on the policy, it can be disputed between every one of the other possible beneficiaries. This can happen in a few different ways. For one, it can occur if the beneficiary is the estate or other such entities, the benefits of the life insurance policy then are used to cover any end bills or debts that the insured might leave behind. This also means that the beneficiary cannot be passed off, and would have to go through a lengthy claims and acceptance of the changes brought forward by the possible beneficiaries claiming to be entitled to the claim.
How to Deal with Denials
The best way to handle denials of FEGLI claims is to always find the best lawyer or attorney. Luckily, we have some of the best lawyers in the city, many that are quite experienced with FEGLI claims. They can help you circumnavigate the loopholes and jargon that can be thrown about in an attempt to disorientate and confuse you. They will help to keep you safe from possible false claims by the company, and make sure you get the paper benefits that you are entitled to.
The truth is, most people have never even heard of FEGLI. Nonetheless, FEGLI (which stands for Federal Employees’ Group Life Insurance) is a program that provides several million Americans with life insurance coverage. When claims made against these policies are denied, however, it takes someone with specialized knowledge and expertise to handle the fight with the insurance company. That’s because FEGLI claims are subject to different laws than other life insurance policies. Consequently, claim denial contests can be even more convoluted than usual.
Moreover, just like normal life insurance policies, FEGLI insurers are highly focused on profits. Therefore, the more claims they can avoid paying, the better their end-of-year balance sheets appear. It is a game that works well for the insurance companies, but can be devastating to life insurance beneficiaries.
In this article, we explore a recent case that illustrates precisely why it is so important to hire a professional when dealing with the denial of a FEGLI claim.
A simple request to change beneficiaries
The case involved a man named Martin who had been a civilian employee of the U.S. Department of Veterans Affairs for 25 years. As a benefit of his employment, Martin received a FEGLI policy. When Martin first received the policy, he named his wife Sharon as the sole beneficiary. She remained Martin’s named beneficiary until she passed away twenty years after the policy was issued.
Shortly after his wife’s death, Martin set about to take care of all the administrative tasks that follow the death of a loved one. One of those tasks was to fill out a Change of Beneficiary form naming a new beneficiary under his FEGLI policy. Martin printed out the form from the internet. Without reading it carefully, he named his neighbor Jim as the new beneficiary, signed the form, and dropped it in the mail.
In truth, Jim was an appropriate beneficiary now that Sharon had passed away. For years, Jim had been like family to the couple. He was nearly twenty years younger than them and he acted very much like a son. He helped out whenever they got sick, he mowed their yard for them, and he was just generally available to help out with whatever they needed. Jim was especially great to Martin after Sharon passed away. Jim’s acts of kindness were very important to Martin given that the only child he and Sharon ever had, Naomi, lived nearly 1,500 miles away and couldn’t even be bothered to attend her mother’s funeral.
After mailing the Change of Beneficiary form, Martin informed Jim of the designation and gave the younger man all the information he would need to file a claim when Martin passed on. Martin lived for a few more years and the two remained close friends throughout.
Confusion following Martin’s death
When Martin passed away, Jim was the primary person to take care of the elder man’s affairs. He contacted Naomi to tell her of her father’s passing and was surprised to hear that her only concern seemed to be when and how she was going to get money from the death. Jim gave Naomi the telephone number for Martin’s attorney who he knew had drawn up Martin’s will and had general knowledge of the full value of Martin’s estate.
As instructed by Martin years earlier, Jim also made a claim for benefits against Martin’s FEGLI policy. He felt a little sheepish about accepting such a big payout (the policy was worth $75,000) but was grateful Martin had thought of him in this way.
A few weeks later, however, Jim was surprised when he received a claim denial letter in the mail. The letter stated that Martin’s Change of Beneficiary Form had been ineffective because Martin failed to include signatures from at least two witnesses. According to the letter, federal laws specific to FEGLI policies required that Change of Beneficiary Forms be witnessed in this manner. Given that Martin’s form was incomplete and that his original beneficiary (Sharon) was dead, the insurer claimed it would seek out Martin’s next of kin and award the FEGLI policy amount to that person.
Jim, of course, knew that Martin’s next of kin was Naomi. Given her reaction to the news of her father’s death, Jim couldn’t stand the thought of her receiving the policy payout. Jim decided to contact an attorney specializing in the wrongful denial of life insurance claims and see if there was anything he could do. It’s a good thing he did.
The attorney first acknowledged that FEGLI Change of Beneficiary Forms generally do require two witness signatures. In some cases, however, principles of equity warranted that an oversight like this be overlooked. The attorney asked Jim if anyone else knew of Martin’s intentions with respect to the policy. Jim knew of three people: (a) Martin’s personal attorney; (b) Jim and Martin’s mutual friend, Ted; and (c) Jim’s wife Patty. In short order, the attorney was able to get sworn statements from each person verifying Martin’s intention that the policy proceeds to go Jim. Martin’s attorney was able to go one step further and swear to the fact that Martin had instructed him to make sure Naomi was not awarded any portion of his estate. In other words, it would have been absolutely contrary to the man’s intentions if Naomi were to be awarded the policy payout.
The attorney presented an internal appeal to the Office of Federal Employees' Group Life Insurance (OFEGLI). After a half-day hearing, the attorney was able to convince the insurer that Martin truly intended for Jim to be his sole beneficiary. Jim was awarded the full policy payout, with interest.
Jim’s case is an important one in that it illustrates how beneficial a specialized attorney can be when facing denial of a FEGLI claim. If you have recently had a FEGLI claim denied and you’re not sure what to do next, call our firm. We specialize in all wrongful denials of life insurance claims, including FEGLI claims. Call us today. We’re here to help.
When you need help, you need a life insurance lawyer who has at least 15 years of experience handling these types of claims. Call us today.
What You Need to Know About Denied FEGI Claims
FEGLI stands for Federal Employees Group Life Insurance. Many federal employees opt into this offering of life insurance. It gives them peace of mind in knowing that their loved one's financial needs are going to be taking care of. In the event of the death of the insured. Many also feel comfortable with this a type of insurance because it is a group life insurance. Most feel that if everyone is opting into this that it must be a good program. Another purpose that it serves is that it is convenient. Meaning that people do not have to take the time to shop around for life insurance coverage. All of these are good factors for FEGLI insurance. One major factor that is not ideal is when the beneficiaries are faced with Denied FEGLI Claims.
The Credibility Of FEGI Insurance
This particular form of life insurance is well known to those in federal employment. It is an insurance that they trust and it is a special type of insurance. Special to the point where it has its own insurance act that governs it. It is known to be the most major group life insurance in the US specifically for Federal employees.
Why Do Denied FEGLI Claims Exist?
A beneficiary expects that with well-known insurance coverage such as this, that producing a claim would be hassle free. It is not uncommon for a beneficiary to end up with Denied FEGLI Claims. There are several different reasons why this can happen. For individuals that are taking out this life insurance they really need to be aware of what the potential pitfalls could be for the beneficiary.
Change Of Beneficiary
There are times when the federal employee wants to change their beneficiary on their FEGLI policy. There is a specific format for doing this. If this format is not followed exactly as required then it can lead to problems for the beneficiary when it comes to Denied FEGLI Claims. The law can change at any time for insurance policies. It is up to the insured to know exactly what the current rules are when doing a beneficiary change for the FEGLI policy.
No Beneficiary Named
It is always wise for a insured to name a beneficiary for their FEGLI life insurance policy. However, on occasion an insured may choose not to do this. This creates a great deal of problems upon the death of the insured. The policy will need to be paid out to someone. Individuals that are applying for the claim may end up with Denied FEGLI Claims because they were not named as the beneficiary. There are laws that deal with this situation but that they are not straightforward. As a result there can be disputes among the beneficiaries as to who the money should go to.
Change Of Beneficiary In Divorce Proceedings
Often individuals that are divorced have many different responsibilities that they must to deal with. One of the things that can be easily forgotten is the change of beneficiary. In the event the insured remarries there can be a conflict over this insurance. This can make it difficult and can end up in Denied FEGLI Claims. Once this happens then there is going to be a long process for getting it sorted out. Most often it will involve having to hire experience life insurance lawyers that specialize in this type of insurance denial. It can be a tough process without a top life insurance law firm. However, due to the large amount that most of these insurance policies consist of it may be well worth the fight.
It should never adjust be assumed that because there is a Denied FEGLI Claims situation that the insurance company is automatically right. Every insurance company is going to thoroughly scrutinize any payment that that they have to make. It doesn't matter how credible the insurance company is, they have the mandate to make sure they are releasing money to the right people. They also have the responsibility of making sure that the insurance policy is valid. It is up to the insured to make sure that they provide all of the proper information so that there will not be any issues such as Denied FEGI Claims. Our life insurance lawyers resolve these claims almost every single time.
No matter who you are, what you do, and what age you are, everyone wants to make sure that they can provide for those under their care. Whether that is a family member, close relative, or spouse and offspring, ensuring that they have a good safety net to work with later on is important, even if that means ensuring one’s own death. That is where Life insurance policies help out quite a bit, and can be used as leverage when attempting to work with those around you.
Unfortunately, many of these policies can be extremely expensive and pricey to pay for. Depending on the length of a policy that you wish to hold, it can be hundreds, if not thousands, of dollars put into premiums and monthly payments, especially if you want to be covered for a wide range of possible outcomes.
Thankfully, there are some groups that can help with more basic policies for life insurance. One of the specific groups that helps those that hold a federal job are FEGLI options. FEGLI, or Federal Employees Group Life Insurance, help those that work for federal companies and employers that may not be able to afford such high priced premiums. Instead of those single payer private insurances, FEGLI allows employees to have a basic policy, given under the company, to help insure against a small range of possible deaths. Specifics do sometimes change from group to group, but can help when you are worried about the future.
But, since it is not a privatized insurance policy, many FEGLI contracts have quite a few stipulations and rules that must be followed. Unlike other contracts, that may allow for a bit of leeway, many FEGLI companies do not allow any leeway, and will attempt to always look a to deny a claim. One such reason is by not being an valid beneficiary.
Reasons For being an Invalid Beneficiary
Each federal company that a person works for will have varying stipulations and rules that must be followed by the beneficiary. This starts from the beginning, before the policy starts, throughout the entire time the policy is active, and even until the policy ends, albeit for a short period.
Before the process even starts, the state will generally hold a large say over who gets to be listed as a beneficiary. This usually comes up when attempting to deal with many different functions, such as dealing with a divorce. In these situations, a state or federal court may require that, instead of a beneficiary that the insured would like, it go to the divorced member as they may need help with kids and such.
Another way to be an invalid beneficiary is to not adhere to the rules given by the company. Although this may seem like a given, many of these rules and guidelines are supposed to be completely followed, even throughout the course of the policy period. If, for any reason, you are deemed to have crossed the line and broken a rule or guideline, the insurance company can simply use that issue or rule broken to turn a beneficiary down.
Finally, if the insured does not have a beneficiary named already, going down the list of people that should receive the benefits can cause problems for ones that attempt to claim that they are the beneficiary, as it will cause delays throughout the entire process. This is due to the life insurance company needing to follow through proper procedures, such as assessing who is next in line. Many insurances place the spouse, or next of kin, as the next available beneficiary, who would then have to be cleared by the company themselves. As such, the claim could be outright denied if you are not meeting those requirements.
How to deal with Invalid Beneficiary Denials
The best way to take care of these denials is to hire a professional and experienced FEGLI lawyer or attorney to help walk you through the steps of getting your benefits. Here at our office, we offer many services to those attempting to just get past the ordeal, and focus on getting their lives back on track and not fighting through legal paperwork. We work quickly and efficiently, and all for your case.
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DENIED FEGLI LIFE INSURANCE CLAIM
James was employed by the District of Columbia Fire Dept. from 1977 until 1990. During his employment, James was insured under the FEGLI Program. This coverage continued after his disability and retirement in 1990.
When James initially began working for the Fire Dept, he designated his then-wife Katharine as his sole beneficiary.
Since James’s insurance was based on his employment, when he retired his policy coverage ended.
In 1993, James wanted to go back to work. After jumping through all the necessary hoops, James was declared un-disabled and was restored to earning capacity.
When he returned to work his FEGLI life insurance policy turned back on, but without a beneficiary. Under Federal Law, when his original policy terminated so did the designation of beneficiary.
From a period from 1993 until 2002, James would retire on and off with disability.
In January 1999, James and Katharine divorced. In 2001, James once again was restored to earning capacity.
In early 2002, James designated Lisa Putnam, his fiancé, as the beneficiary of the FEGLI policy.
The day after James filed the form he passed away.
Lisa and Katharine both filed a claim for the benefits.
In sorting through which designations were valid or invalid, the court determined that Lisa’s designation form was invalid.
Lisa’s form only contained one witness signature, not two, as required by law.
The court also determined that Kathreine’s designation was also invalid.
When James retired and returned back to work, Kathrine’s name didn’t reactivate.
WHO GETS THE MONEY?
The court ruled that James’s children were the rightful recipients. Since James had no rightful designation, the policy would pass through probate. Probate would assign James’s children as the rightful recipients, so the court did the same.
James’s children, however, did him one better and assigned all their rights to the benefits to Lisa and not their mother.
James’s case isn’t uncommon. Changing beneficiaries on FEGLI life insurance policies are complicated. Disputes often arise here first. Ensure you always have your forms signed by and in front of two witnesses, approved by the Office of Personnel Management (OPM).