Life Insurance Lawyer Arizona
Whether you reside in: Peoria; Tempe; Gilbert; Scottsdale; Glendale; Chandler; Mesa; Tucson; or Phoenix; our life insurance attorneys who live and work here in Arizona are here to help resolve your delayed or denied life insurance claim.
What happens when multiple beneficiaries claim life insurance benefits?
The answer may not be as easy as you think
Many people only maintain life insurance because it is a benefit of their employment. In those instances, coverage is often so automated that the insured rarely thinks about their policy at all. In fact, they may only remember that they have a life insurance policy when the insurer contacts them to ask for information or offer details about coverage.
Such was the case for a Kentucky gentleman named Mark. Mark received a $100,000 life insurance policy through his employer. At the relatively young age of 48, life insurance was not a big concern to Mark. He planned on living a full life and never anticipated that anyone would be fighting over his life insurance proceeds for decades to come.
Life had different plans for Mark, however. His case is a cautionary tale for all of us that – regardless of age – we all need to plan for what happens to our estate when we pass. As lawyers who specialize in contesting the denial of life insurance claims, we see situations like Mark’s all the time. Consequently, this article focuses on his case and how, if he had just done some additional planning, he could have saved his loved ones a lot of stress and consternation.
Setting up his policy
As noted, Mark was a 48 year-old man living in Kentucky. Mark had a great job as a civil engineer, had a full roster of friends, and a family who adored him. In 2014, right around the time he accepted a new position with a regional engineering firm, Mark was dating a woman named Olivia. Everyone who knew the couple knew that he was smitten.
Consequently, when it came time for Mark to fill out his new employee paperwork, he had Olivia on his mind. One of the things Mark had to do was to complete enrollment in the firm’s group life insurance plan. As part of that process, he was asked to name a beneficiary of his life insurance proceeds. At the time, naming Olivia as his beneficiary was a no-brainer for Mark. He loved her and even planned to marry her in the near future.
Unfortunately, things didn’t turn out as Mark had hoped. Over the course of the next year, the couple started fighting regularly and, by the time they broke up in November 2015, they basically couldn’t stand one another.
In July 2015 – just months prior to his breakup with Olivia – Mark received an email from his life insurance company. It was the one-year anniversary of his employment with the engineering firm and, as such, they needed him to update his policy information. To facilitate the process, they provided Mark with a link to the company’s website where he could input any new information easily.
One of the things Mark was asked to do was update his life insurance beneficiary, to the extent he wished to make a change at all. In the midst of his relationship struggles with Olivia, he simply left that question blank. It never occurred to Mark that that simple decision would have such a massive impact on the people in his life.
Who is the intended beneficiary?
Unfortunately, Mark was completely unaware that he had very little time left on the planet. In December 2015, Mark died in his sleep of an apparent brain aneurysm. Mark’s employer notified the life insurance company of his death, hoping to facilitate a fast payout of the death benefit for Mark’s chosen beneficiary.
When insurance company representatives reviewed the file, however, they were at a quandary for what to do. Mark had clearly named Olivia as the beneficiary in his 2014 paperwork. In 2015, however, he left the question about his beneficiary blank. According to the policy terms, any time an insured failed to name a beneficiary, the death benefits would simply be paid to his next of kin. In Mark’s case, that was his sister, Linda.
Sure enough, both Olivia and Linda ended up submitting claims for Mark’s $100,000 death benefit. Unsure of who to pay, and not wanting to incur double liability, the insurance company initiated what is known as an “interpleader” lawsuit. In an interpleader action, the insurance company essentially recognizes that it has to decide between two claimed beneficiaries, and asks for the court’s guidance in determining who should receive the policy payout.
Within that action, Olivia and Linda fought each other hard. Importantly, however, Linda hired an attorney who specializes in contesting life insurance claim denials. While Mark’s insurance company hadn’t denied her claim yet, she realized that without specialized representation, she was at risk of a full denial.
Linda’s attorney presented ample evidence to support her claim for benefits. In particular, he noted Mark’s intentional refusal to name a beneficiary in 2015 – and contrasted that with his desire and willingness to name Olivia as the beneficiary a year earlier. The attorney also pointed to the clear policy language directing the life insurer to pay the policyholder’s next of kin in the event he died without a named beneficiary.
For her part, Olivia presented evidence regarding the deep and intense relationship that she had shared with Mark. She argued that in light of their recent breakup, Mark still would have wanted her to receive the policy proceeds.
Ultimately, the court sided with Linda, as her attorney made arguments centered on law and the policy language, as opposed to arguments based solely in emotional appeal. The court ordered the life insurance company to pay the full $100,000 benefit to Linda, with interest.
These sorts of disputes are more common than you might think. If you believe you are the rightful beneficiary to life insurance proceeds but find that someone else is also claiming that right, call us. The sole focus of our practice is life insurance claim denials. We’ll evaluate your case honestly and if we believe you are the intended beneficiary, we’ll fight for your right to receive the benefits your loved one intended for you. Call us today. We’re here to help.
- Number one is a misrepresentation on the application. This typically involves failing to disclose a medical condition. However, we can get over this hurdle the majority of the time.
- A lapse of a life insurance policy is probably second most common. What happens is that the insured gets sick and misses a payment or two. These are tough, but often we can get these claims paid.
- Probably third is the type of death exclusion. This could be a suicide or it could be a self-inflicted injury. Murder is another exclusion. Health again can fall under this exclusion. We often win suicide exclusions as we cite case law that the death was actually accidental.
- A very common exclusion is the alcohol exclusion. The insured may have been killed in a car crash, but the autopsy revealed alcohol in the person’s system. We have many legal briefs to combat this exclusion.
- Heroin and opiates or illegal drug exclusion is one of the biggest now. With the opioid crisis, there are tens of thousands of deaths.
- Prescription drug overdose exclusion may involve an overdose of medicine or taken medicines that are contraindicated.
- An ex-spouse being cut off from life insurance benefits is a big one. We actually have a half dozen ways to get over this hurdle.
- Having a spouse not listed as a beneficiary is another reason for denial
- Having a child not listed as a beneficiary is one too.
- Having only a primary beneficiary who is deceased is another.
- On an AD&D (accidental death and dismemberment) life insurance policy, a fall not being considered an accident is extremely common.
- The insured’s age not being correct on the initial application is a reason for denial.
- Having the wrong social security number listed is common.
- An autoerotic asphyxiation exclusion is an easy one for us to beat.
- An omission on the application is a big reason for denying a life insurance claim, but we have legal briefs to this effect.
- Not providing the required documents to the insurance company after death is a reason.
- Information which is argued to not be correct is one.
- When there is a dispute between two or more beneficiaries, an interpleader may occur, and we always get these resolved quickly.
- A beneficiary not named is a reason for not paying it out.
- A life insurance policy may be transferred from one company to another by the employer which causes major problems.