In 2020, Americans paid more than $250 billion in life insurance premiums. For the most part, those premiums are paid by working-class and middle-class people hoping to provide for their families when they are gone. The average face value of those policies is about $170,000.
Fortunately, most life insurance claims are paid. But, delayed life insurance claims can have a significant impact on the insured’s loved ones during what is already a very difficult time. Read about reasons why life insurance claims are denied
Life Insurance Law Requires Life Insurance Companies to Act Quickly
The legislature understands that an unreasonable delay in receiving insurance benefits can cause a significant hardship. Life insurance law requires that investigation of any insurance claim be completed within 30 days of receiving notice of the claim, unless the investigation “cannot reasonably be completed within the time.”
If investigation will delay a decision regarding payout of life insurance benefits beyond the 30-day period, the insurance company is required to provide written notice and explanation for the delay, and to update the beneficiary every 45 days thereafter if the investigation is still not complete.
The Life Insurance Company Doesn’t Decide What’s Reasonable
If you’ve received a notice of delayed life insurance benefits from the carrier, don’t assume that there’s nothing you can do. The statute clearly specifies that the notice and explanation option only kicks in when the investigation cannot reasonably be completed within 30 days. Ultimately, it is not the insurance carrier that decides whether or not the delay is reasonable.
Unfortunately, too many people believe that the life insurance company has all the power, and that as long as they keep receiving those letters offering excuses for the delay, they are powerless to move the claim forward. If an insurance company is stringing you along, delaying payment of a life insurance claim, it is in your best interest to talk to an attorney who handles delayed life insurance and denied life insurance claims as soon as possible.
The Insurance Company May Be Required to Pay Interest on Delayed Payments
If the insurance company’s delay is deemed unreasonable, the company may be liable not just for the benefits under the policy, but also interest from the time the life insurance claim should reasonably have been paid.
The Life Insurance Company Doesn’t Have All the Power
It’s easy to believe that a national or international company generating hundreds of millions of dollars in revenue each year holds all the cards. Many life insurance beneficiaries don’t believe they can successfully fight an insurance company. The obstacles may seem even greater shortly after the death of a loved one, when emotional and practical concerns may be overwhelming.
Sadly, some life insurance companies are aware that people submitting life insurance claims are already facing difficulties and may not feel in the best position to fight back. Unscrupulous insurers take advantage of a beneficiary’s distraction to unreasonably delay or deny life insurance claims, knowing that many beneficiaries won’t fight back.
Claim the Life Insurance Benefits Your Loved One Intended
When a carrier unreasonably delays processing of a life insurance claim or denies the claim in erroneously or in bad faith, that company isn’t just cheating the beneficiary out of money. It is robbing the deceased of a last opportunity to provide for his or her loved ones—an opportunity the insured paid good money for during the months, years, or even decades before he died.
You don’t have to accept the insurance company’s decision, and you don’t have to tolerate inaction. If the insurance company is dragging its feet in processing a life insurance claim or has unreasonably denied the claim, the law is on your side.
Talk to an Attorney Experienced in Delayed or Denied Life Insurance Claims
Life insurance law is a very specific niche, and not every law firm has the experience to consistently prevail in delayed or denied life insurance claim cases. Our life insurance lawyers have a strong history in the life insurance claim litigation arena.
If you’ve recently lost a loved one and your life insurance benefits have been denied or the insurance company is delaying a decision, take the first step toward protecting yourself and your loved one’s intentions right now. Schedule a free consultation.