If you’ve ever lost a loved one prematurely, you know exactly how painful that experience can be. To make matters worse, it’s rare that someone can take the time they need to fully grieve the death. Instead, there are all sorts of things that one must attend to – like the funeral, estate administration, and life insurance.
Regrettably, in all our years as attorneys specializing in the wrongful denial of life insurance claims, we’ve witnessed far too many situations where the life insurance company just makes the whole thing worse. They do this by issuing bogus claim denials and forcing policy beneficiaries – who are already struggling – to jump through all sorts of hoops just to get the benefits their loved ones intended for them.
Life insurance companies don’t do this because they are filled with bad people. Rather, they do this because they are for-profit entities that have to show shareholders a profit at the end of each year. Each time a life insurer gets away with wrongfully denying a claim, they’ve just generated profits that make the company appear more successful.
Of course, life insurance companies can’t just deny claims for no reason. They’re legally obligated to tell beneficiaries exactly why they’re denying a claim. Consequently, they will often concoct illegitimate claim denial justifications that sound just “legal” enough to satisfy most beneficiaries.
One of the life insurers’ favorite tools in this regard is a policy provision known as the “suicide exclusion.” Most life insurance policies relieve the insurance company from paying a death benefit if the policyholder commits suicide within the first two years after the policy has issued.
Unfortunately, some life insurance companies have a bad habit of invoking the suicide exclusion even when there is no evidence that the policyholder actually died by his own hand. This article presents one such case.
A tragic work accident
The case involved a man named Steven. Steven was one of those guys most of us only see in pictures. He was a steel worker who specialized in the construction of tall buildings – the guy you see walking effortlessly along a steel beam that will eventually be the floor support for a 30-story building.
Given the skill required for his job, Steven was compensated at a much higher level than most of his peers. He also got greater employment benefits than other construction workers, including a $2,000,000 life insurance policy paid for by his employer. When Steven signed up for the policy, he named his only son Matthew (age 23) as his sole beneficiary.
Steven had lost his wife in a car accident 15 years earlier and Matthew was his only living relative. Fortunately, the two had a great relationship that included hobbies like vintage car restoration. In fact, Steven and Matthew had been working on a car for over three years that they planned to enter into a big car show during the coming summer.
Sadly, after performing his dangerous job for over 20 years, Steven had a tragic accident. Witnesses at the scene told police that Steven was installing beams on the 15th story of a new office building when a strong gust of wind came up out of nowhere. Steven reached for a nearby beam to steady himself. Unfortunately, the wind was faster than he was. Steven was blown off the beam and fell to his death.
Police responded immediately. They conducted a thorough investigation and issued a report concluding that Steven’s death was a freak accident. The official cause of death listed on Steven’s Death Certificate was “accidental fall.”
The claim denial
As broken up as Matthew was about his father’s death, he knew he had to go on. The first thing he did was file a claim against Steven’s life insurance policy. That included submission of both the Death Certificate, as well as the police report from the scene of the incident. Once that was done, Matthew set about to finish restoring the car he and his dad were going to enter into the car show. Matthew figured the money from his dad’s life insurance policy would help him finish the project on time.
A few weeks later, however, Matthew got a claim denial letter in the mail. The letter said Steven’s death came within the suicide exclusion of the policy. It went on to state that the facts and circumstances of the incident could lead to no other conclusion but suicide.
Matthew was floored. Nonetheless, he was a sharp young guy. He immediately got on the phone and started calling lawyers. Eventually, he was referred to a lawyer specializing in the wrongful denial of life insurance claims. The lawyer wasn’t surprised by the denial at all. He knew this insurance company and knew they would often try to invoke the suicide exclusion in circumstances where it made no sense. He also knew Matthew was going to have to sue the company to get his money.
The lawyer filed suit on Matthew’s behalf the following Monday. The complaint stated claims for breach of contract and bad faith denial of benefits. The latter claim carried the possibility of punitive damages against the insurer.
Shortly thereafter, the case was referred to arbitration. The lawyer presented the following evidence: the police report, sworn witness statements from those who saw the accident occur, and evidence suggesting Steven’s interest in living – including the upcoming car show with his son. The insurance company, on the other hand, had no evidence aside from the fall itself to suggest suicide.
The arbitrator quickly ruled in Matthew’s favor and ordered the insurer to pay the full policy benefit, plus interest. The insurance company, recognizing it was dead in the water, did not appeal that decision.Unfortunately, Matthew’s case is not unusual. Life insurance companies play these games all the time. If you have received a life insurance claim denial that just doesn’t feel right, please call our attorneys. If we can possibly help you recover the benefit your loved one intended for you, we will. Call today. We’re here to help.