Case Overview:
A widow filed a life insurance claim after her husband died while covered under an employer-provided group life insurance policy issued by American Income Life Insurance. The insurer denied the claim, asserting that the insured was not actively working full time at the time of death and therefore was not eligible for coverage.
Legal Issue:
Whether the insured lost coverage due to alleged employment status changes, and whether the employer or insurer failed to properly administer or disclose eligibility and continuation rights.
Outcome:
After legal action was initiated against both the employer and the insurer, the case resolved with a full $60,000 payout to the widow. The denial was overturned based on improper application of eligibility rules and failures in plan administration.
Key Takeaway:
Group life insurance denials based on employment status are frequently reversible when employers or insurers misapply plan terms or fail to give required notices.
Additional Denied Life Insurance Claims Successfully Resolved
Union Security Life Insurance Claim Denied
Issue:
A retired employee was never informed of his right to convert group life insurance to an individual policy.
Outcome:
The claim was resolved favorably after litigation against the employer and insurer.
Brighthouse Financial Life Insurance Claim Denied
Issue:
The insured died while on approved medical leave. The insurer claimed he did not meet active employment requirements.
Outcome:
Medical records proved continued eligibility, and the full $300,000 benefit was paid.
CNO Financial Life Insurance Claim Denied
Issue:
Coverage was denied after termination when the insured was not informed of portability rights.
Outcome:
Legal action resulted in a favorable settlement for the beneficiary.
Pacific Guardian Life Insurance Claim Denied
Issue:
The insurer denied the claim based on an alleged undisclosed hazardous activity.
Outcome:
The court ruled the exclusion was improperly applied, and the beneficiary recovered the proceeds.
Talcott Life Insurance Claim Denied
Issue:
The policy was rescinded for alleged nondisclosure of a heart condition shortly after issuance.
Outcome:
The denial was challenged, and the claim was ultimately resolved in the beneficiary’s favor.
Oceanview Life Insurance Claim Denied
Issue:
The insurer claimed the policy lapsed due to a missed premium.
Outcome:
Litigation established improper lapse handling, and benefits were paid.
American General Life Insurance Claim Denied
Issue:
The insurer denied coverage after the insured was killed by police, citing an illegal acts exclusion.
Outcome:
The case settled in favor of the beneficiary after the exclusion was shown to be misapplied.
Why Group Life Insurance Claims Are Commonly Denied
Many denied group life insurance claims stem from:
• Misinterpretation of active employment rules
• Failure to provide conversion or portability notices
• Improper lapse determinations
• Incorrect reliance on exclusions
• Employer administrative errors
These denials are often legally flawed and highly fact-dependent.
How Life Insurance Lawyers Help Reverse Denials
Successful challenges typically involve:
• Reviewing plan documents and certificates
• Identifying notice and disclosure failures
• Analyzing ERISA or state law applicability
• Holding employers accountable for administrative errors
• Litigating eligibility and coverage disputes
Early legal intervention often determines whether benefits are recovered.
Frequently Asked Questions
Can a life insurance claim be denied because someone was not working full time
Yes, but many such denials are improper and based on incorrect eligibility interpretations.
Is the employer responsible for group life insurance errors
Often yes. Employers can be liable for failing to explain coverage, conversion, or portability rights.
Can a denied group life insurance claim be overturned
Yes. Many denials are reversed through appeal or litigation.
Should I accept a denial letter at face value
No. Denial letters frequently misstate the law or policy terms.