Most denials are not rooted in legal merit—they’re based on tactics designed to limit payouts and maximize profits. Common justifications include:
Claiming the policy lapsed due to nonpayment
Alleging errors or omissions on the application
Invoking exclusions for certain causes of death
Arguing the claim was filed late or documentation is incomplete
Asserting fraud without concrete evidence
In many cases, insurers deny claims even after the contestability period (typically two years) has expired, hoping beneficiaries won’t push back. But if the reasons seem vague or manufactured, you may have strong legal grounds to sue. If you have Washington life insurance claim issues call us.
What Is Bad Faith in Life Insurance Denials?
Insurers have a legal duty to act in good faith. This means they must process claims fairly, promptly, and honestly. When they fail to do so, they may be liable for bad faith, which can result in additional compensation beyond the policy amount.
Bad faith may include:
Denying a claim without reasonable basis
Delaying payment without justification
Misrepresenting policy terms or exclusions
Retroactively canceling a policy to avoid paying
Failing to respond or communicate in a timely manner
If you suspect your insurer is acting in bad faith, legal action may not only secure the death benefit—but also punitive damages, interest, and attorney’s fees.
When Can You Sue a Life Insurance Company?
You may have a strong legal case if:
You received a denial letter without clear or valid reasoning
Your claim has been delayed far beyond state or federal guidelines
The insurer canceled the policy without proper notice
You’ve completed the internal appeal process (for ERISA group plans)
You were misled by your employer or the plan administrator
If your policy falls under ERISA (most employer-provided life insurance does), you must first exhaust the insurer’s internal appeals. After that, you can file suit in federal court—where deadlines are strict and procedural errors can be costly. That’s why an experienced ERISA attorney is essential.
Legal Grounds to Sue a Life Insurance Company
Depending on the facts of your case and your state’s laws, your lawsuit may be based on:
Breach of contract – Failure to pay under the terms of the policy
Bad faith – Mishandling the claim or denying it for dishonest reasons
Unfair trade practices – Violating state consumer protection laws
Each of these claims requires a strategic legal approach, backed by detailed evidence and policy analysis.
What to Do Before Filing a Lawsuit
Before you file suit, take these steps to build a strong foundation:
Gather all documents – The policy, claim forms, denial letters, medical records, and all correspondence with the insurer
Track dates and deadlines – Missed notices or delays can be used as evidence of bad faith
Limit verbal communications – Insurers often record calls; stick to written communication when possible
Consult an attorney immediately – Early legal involvement can prevent procedural missteps and preserve your right to sue
How a Life Insurance Denial Attorney Can Help
Our firm handles life insurance denials exclusively, and we’ve recovered benefits in cases involving:
Improper policy lapses
Misinterpreted suicide or exclusion clauses
Delayed claims under ERISA plans
Retroactive cancellations without notice
Denials based on vague or contradictory policy terms
Often, getting an experienced lawyer involved forces the insurer to re-evaluate the claim. When that doesn’t work, we don’t hesitate to litigate.