We recently secured a $300,000 payout for a client whose life insurance claim had been denied due to vague wording buried deep within the policy. The insurer relied on a loosely worded exclusion clause to argue that the death wasn’t covered. But our legal team broke down the policy, challenged the ambiguous interpretation, and got the full amount paid.
Insurers write these policies and often load them with technical terms the average policyholder would never interpret the same way. When that unclear language becomes the reason for a denial, it’s not the end of the story, it may be the beginning of a legal opportunity. If you want to learn how to appeal a life insurance denial in Vermont call us.
When Policy Language Is Used to Deny a Life Insurance Claim
Life insurance companies often reject claims using vague or complex terms that can be interpreted more than one way. They might say the death was excluded because of how the policy defines “accident,” “natural causes,” or “self-inflicted injury,” even though those terms are not clearly explained in the document.
In the $300,000 case we resolved, the insurer denied a claim after a man died of a head injury sustained during a fall in his kitchen. The company pointed to an exclusion for “injuries related to physical impairment” and claimed his arthritis played a role in the fall. But the term “related to” was never defined, and the policy did not explain how far that connection could reach. We argued that the exclusion was overly broad and failed to give the insured fair notice. The insurer backed down and paid the claim in full.
Examples of Disputed Policy Language Denials
A woman in Indiana died after being bitten by a venomous snake during a camping trip. The insurer denied the claim based on an exclusion for “injuries from animal encounters during unsanctioned travel.” The term “unsanctioned” appeared nowhere else in the policy. We showed that the trip was recreational and lawful, and that the language was too vague to deny coverage. Her spouse received the full benefit.
In New Mexico, a man passed away during a charity 5K run due to heatstroke. The insurer refused to pay, arguing the death fell under an exclusion for “voluntary participation in physically extreme activity.” We demonstrated that the term “extreme” was undefined and that a community-organized run did not meet any reasonable definition of the word. The claim was reversed.
One case from North Carolina involved a fatal fall during a home renovation. The insurer denied coverage based on an exclusion for “occupational hazards.” We proved the insured was not performing professional labor and that the home project was personal in nature. The insurer conceded after we submitted affidavits and building permits showing he was a homeowner, not a contractor.
These examples reflect how insurers attempt to use policy wording as a shield. If a term is left undefined, that vagueness can be challenged under contract law principles.
What Is Ambiguous Language in a Life Insurance Policy?
Ambiguous language is any clause or term that can reasonably be interpreted in more than one way. Courts apply a principle called “contra proferentem,” which says that unclear contract terms should be interpreted against the party that drafted the document. In life insurance, that’s almost always the insurance company.
So if a policy says benefits won’t be paid for a “self-inflicted injury” but does not clarify whether that includes risky but legal behavior, the ambiguity can be used in the beneficiary’s favor. The same goes for undefined phrases like “hazardous activity,” “natural causes,” or “dependent condition.” These terms must have clear, consistent meaning or they cannot be used to deny payment.
What If the Insurer Claims an Omission on the Application?
Policy language isn’t the only weapon insurers use. Many denials are based on alleged omissions from the life insurance application. The insurer may claim the decedent failed to disclose a health condition, past surgery, or tobacco use. But whether that omission justifies denial depends on several factors.
The most important is timing. If the policyholder died within the contestability period, usually the first two years of the policy, the insurer can try to rescind coverage for any material misstatement. But they must prove the omission was significant enough to change the underwriting decision. A missed detail about minor asthma is not the same as concealing a cancer diagnosis.
If the contestability period has passed, the insurer must prove actual fraud. That means they must show the policyholder knowingly gave false information with the intent to deceive. Honest mistakes and forgotten details don’t meet that standard.
We handled a case in Florida where a woman failed to list her use of anxiety medication. When she died of unrelated injuries in a boating accident, the insurer tried to void the policy. We argued the omission was irrelevant to the risk assessment and had no bearing on her cause of death. The insurer withdrew the denial after we filed a challenge.