Denied FEGLI Claims
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.
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.
Time to Get a Denied FEGLI Claim Lawyer
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.
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