Understanding the wide range of possible denial reasons can help you identify whether a claim was unfairly denied—and whether it can be challenged. Below are 50 potential reasons life insurance claims are denied.
Top 50 Reasons for Life Insurance Claim Denials
Policy lapsed due to non-payment of premiums.
Policy was formally cancelled before the insured’s death.
Cause of death was excluded under the terms of the policy.
Misrepresentation or false information was provided on the application.
Insured died by suicide within the contestability period.
Insured died while committing a criminal act.
Insured died during a high-risk activity not disclosed on the application.
Death occurred while the insured was intoxicated by drugs or alcohol.
Death occurred while traveling to a location deemed high-risk or restricted.
Policy was not in force at the time of death.
Insured passed away before fulfilling the policy’s required waiting period.
Beneficiary designation was incomplete or invalid.
Beneficiaries were never informed the policy existed.
Beneficiaries were minors and no guardian or trustee was appointed.
Dispute over legal entitlement to receive the death benefit.
Policy lacked named beneficiaries or the designation had expired.
Policy was part of a group plan, and the insured had lost eligibility.
Term life policy had expired prior to the insured’s death.
Permanent policy had been surrendered for cash value.
Joint life policy had already paid out on the first insured’s death.
Key person insurance applied to someone no longer employed or critical to the business.
Business continuation policy was no longer enforceable due to business dissolution.
Buy-sell agreement policy was invalid due to improper execution or funding.
Modified endowment contract (MEC) was improperly structured.
Viatical settlement was not legally compliant or properly transferred.
Stranger-originated life insurance (STOLI) was deemed illegal.
Credit life policy was tied to a loan that had been paid off.
Group credit life insurance was void due to group membership termination.
Creditor-placed policy was overridden by existing borrower coverage.
Mortgage life policy was null after mortgage payoff or refinance.
Juvenile policy was improperly converted or ownership was not transferred.
Senior life insurance policy included a waiting period not yet met.
Funeral insurance was denied because costs had already been prepaid or reimbursed.
Final expense policy denied because documentation did not support claim.
Guaranteed issue policy rejected due to ineligibility at time of issuance.
Simplified issue policy denied after failing a health screening or questionnaire.
Fully underwritten policy denied for failure to disclose a known condition.
Retroactive policy claim denied due to inaccurate or incomplete medical history.
Term conversion policy invalid because conversion request was never completed.
Variable policy’s value was diminished due to poor investment performance.
Universal life policy denied due to exhausted cash value and lapse.
Whole life policy claim denied because of unpaid loans or insufficient dividends.
No-exam policy denied after discovery of medical conditions that would have disqualified the applicant.
No-questions-asked policy claim denied for undisclosed high-risk conditions.
Term policy was no longer active at time of death.
Guaranteed renewable policy denied for failure to pay increased renewal premiums.
Non-guaranteed renewable policy was not renewed by the insurer.
Return-of-premium policy cancelled early, voiding the return clause.
Survivorship policy denied because second insured had not passed away.
Group survivorship claim denied due to lack of coverage or ineligibility of surviving insured.
Life insurance companies may deny claims for dozens of reasons—but that doesn’t mean the denial is final. If your claim was rejected for any of the reasons listed above, consult with an experienced life insurance lawyer to explore your legal options. Our firm fights to overturn denials and recover the full amount our clients are owed.
FAQ: Life Insurance Claim Denials
Can I fight a life insurance claim denial?
Yes. Many denials are based on questionable interpretations of policy language, administrative errors, or omissions that can be challenged through legal action.
What is the contestability period in life insurance?
It is a two-year period after policy issuance during which the insurer can investigate and deny claims for misstatements, even unrelated to the cause of death.
What if the policy lapsed before death?
Insurers will typically deny claims for lapsed policies. However, we’ve reversed many such denials by showing that premium notices were never sent or grace periods were improperly handled.
Can a claim be denied if the policyholder lied on the application?
Yes, but only if the misrepresentation was material and affected the insurer’s decision. Honest mistakes may not justify denial.
Do beneficiaries have rights if they were unnamed or removed?
It depends on the circumstances. Legal heirs or former beneficiaries may have a claim if changes were improperly executed or violated state law.
Can a policy be denied for suicide?
Yes, if it occurred within the suicide exclusion period (usually two years). After that period, suicide is typically covered like any other cause of death.
What if the policy was part of an employer benefit plan?
Employer-provided life insurance is governed by ERISA and has specific rules for appeals and litigation. Our attorneys handle these complex claims nationwide.
Is a policy still valid if the business that purchased it no longer exists?
In many cases, yes—especially if the policy was individually owned or funded. The claim may still be valid depending on how the policy was structured.
What if the policy was cancelled by mistake?
We have reversed cancellations by proving insurer error, unauthorized surrenders, or payment processing failures. Every cancellation should be reviewed carefully.
Do I need a lawyer to appeal a denied claim?
Yes. Insurance companies have legal teams focused on defending denials. Working with an experienced attorney significantly increases your chances of success.