When most people think about life insurance, they think of it as something that automatically kicks in when the policyholder dies. Many people are shocked to learn just how often these policies actually do not kick in. As a matter of fact, denying perfectly valid claims is big business for the life insurance industry.
Indeed, life insurance companies hire armies of lawyers to draft policy language that is intended to assist them in denying valid claims when the policyholder dies. Then, there is a whole other category of lawyers within a life insurance company whose job it is to dream up claim denial justifications after the person actually dies. In fact, given how many lawyers are insured by life insurance companies, it's a wonder any claims ever get paid at all.
One tool that life insurance company lawyers love to use when it comes to denying claims is the policy exclusion. Some exclusions are rather familiar. For example, most people have heard of the suicide exclusion. Many people do not know, however, that there are several other exclusions that are made a part of nearly every life insurance policy.
One such exclusion is known as the “felony exclusion.” It basically states that if the policyholder dies during the commission of a felony, the insurance company is relieved from its obligation to make a death payout. Just like with all the other exclusions, the felony exclusion is often invoked inappropriately by insurance companies in a simple effort to deny valid claims made by policy beneficiaries.
This article explores one such case and illustrates the importance of hiring the right legal team anytime a large corporation (like a life insurance company) treats you or your family anyway that doesn't seem fair.
Just out to have a good time
The case involved a man named Brian. Brian was a welder at a local shipyard and had, as a benefit of his employment, a lucrative life insurance policy. Perhaps predictably, Brian named his wife Sue as the sole beneficiary under the policy.
Brian was what most people would call it good old boy. He liked to fish, hunt, and perhaps more than anything, he loved Major League Baseball. His favorite team was the Los Angeles Dodgers and even though it was a stretch financially, he and Sue had been season ticket holders for at least 20 years.
One year during late summer, Brian and Sue were attending a contentious game with playoff implications. It was a hot day, the score had been tied for several innings, and tempers were starting to flare, especially among fans who had been drinking for hours. Witnesses would later recount exactly what happened in the last moments of Brian's life.
The Dodgers lost the game based on a very controversial homeplate call by the umpire. The home crowd went insane, as the loss almost certainly signaled the end of the Dodgers’ playoff hopes.
As fans poured out of the stadium, a particularly unruly group began shoving each other around. One man was shoved into Brian which caused Brian to fall back against another patron. That person, who was clearly intoxicated, attempted to punch Brian in the face. Brian successfully blocked the punch and swung back toward that individual. Brian’s right fist connected with the man's left temple which caused him to drop to the ground immediately. He suffered a mild concussion as the result of Brian’s punch.
After that, the man’s friends jumped Brian and began beating him mercilessly. Brian died of a severe head contusion at the scene. Within moments of the fight breaking out, stadium police were on scene. They didn't let anyone who had witnessed the fight leave the stadium until they performed a thorough investigation.
Life insurer calls the policyholder a felon
When Sue submitted a claim for policy benefits to Brian’s life insurance company, she had no reason to believe the claim would be denied. Unfortunately, that is exactly what happened. After reviewing the autopsy report and all police reports from the scene, the insurer concluded that because Brian died as the result of being involved in a group fight, and because he caused a concussion in another individual, he died during the commission of a felony. Because the policy contained a felony exclusion, the letter explained, the insurance company was within its rights to deny Sue’s claim.
The letter made no sense to Sue. A friend suggested she contact an attorney specializing in the wrongful denial of life insurance claims. It's a good thing she did. The lawyer listened to her story and reviewed all of the documents that she had submitted to the life insurance company. Of particular importance to the lawyer where they multiple witness statements referring to the fact that Brian had not instigated the fight. To the contrary, all witnesses stated that Brian had only raised his fists in an effort to defend himself.
The life insurance company had conveniently overlooked this important detail. The law is rather clear when it comes to the issue of self-defense. If you harm someone during a fight but you only do so in response to aggressive actions taken by that other person, you have a complete defense to any charges of assault and battery. Here, Brian would obviously never undergo a trial or get to present that defense. Nonetheless, witness statements from the scene made it patently clear Brian was not an instigator. That means he was not a felon and, therefore, the felony exclusion was improperly applied by the insurance company.
By arguing these facts to the insurance company's internal appeals board, the lawyer was able to successfully overturn the claim denial. Fortunately, Sue made the correct decision in contacting a specialized lawyer. Many people don't know they have the right to do so.Our firm practices exclusively in this area. If you have had a life insurance claim denied and the reasoning for the denial doesn't seem fair to you, give us a call. We're here to help.