Our attorneys recently resolved a $2 million life insurance claim, and we understand how crucial it is to follow the correct procedures to avoid unnecessary complications.
One thing to keep in mind is that insurance companies can refuse to pay the claim if there are any errors or omissions on the application—even the smallest mistake can lead to denial. Common errors include incorrect contact information, missing details, wrong age, or hidden pre-existing medical conditions. Therefore, ensuring accuracy and following the proper steps in filing the claim is essential.
Common Reasons for Life Insurance Claim Denials
Before diving into the process, it's important to know the reasons life insurance claims get denied. Some of the most common include:
Incorrect Contact Information
Mismatched or incomplete contact details can delay the process or lead to a denial.Missing Information
If required documents or information are missing or incomplete, the claim can be rejected.Wrong Age
If the age listed on the application is incorrect, it may lead to complications, especially if the policy had age-related restrictions.Hidden Pre-Existing Medical Conditions
If the policyholder didn't disclose medical conditions that could affect the policy, this could lead to a denial, especially during the contestability period.Unpaid Premiums
If premiums weren’t paid, the policy could lapse, rendering the death benefit invalid.
FAQ: Frequently Asked Questions About Life Insurance Claims
1. What should I do if my life insurance claim is denied?
If your life insurance claim is denied, the first step is to contact the insurance company for a written explanation. You may also be able to appeal the decision, and working with an attorney can significantly improve your chances of success.
2. Can I file a life insurance claim if there’s no beneficiary listed on the policy?
If no beneficiary is listed, the death benefit may be paid to the policyholder’s estate, which could complicate the process and lead to additional taxes and delays. It’s crucial to designate beneficiaries to avoid this situation.
3. How long do I have to file a life insurance claim?
While you have unlimited time to file a claim as long as the policy is in effect, there may be time limits based on your specific policy or the insurance provider’s terms. Be sure to check the policy details for any deadlines.
4. What can I do if my claim is denied due to unpaid premiums?
If your claim is denied because the policy lapsed due to unpaid premiums, you may be able to reinstate the policy if it hasn’t been lapsed for too long. Contact the insurance company or an attorney to discuss your options for reinstatement.
5. Can a life insurance company deny a claim if the policyholder died by suicide?
If the policyholder dies by suicide, the contestability period often plays a role. Most policies exclude suicide claims within the first 2 years of coverage. However, after that period, the death benefit may be payable.
6. Can I contest a life insurance claim denial?
Yes, you can contest a denied claim. The first step is to file an appeal with the insurance company. If that doesn’t work, legal action may be required. Consulting with an experienced life insurance attorney can guide you through the appeal and litigation process.