Life Insurance Lawyer Rhode Island

Rhode Island Denied Life Insurance Claims Recently Settled

Prudential invalid beneficiary designation $405,000.00
HSBC felony exclusion crime commission $321,000.00
AIG alcohol exclusion drunk driving death $288,00
Rhode Island denied life insurance claim $1,653,000.00
Globe the contestability period medical $104,000.00
FEGLI appeal won after legal brief $139,000.00
Stonebridge policy not in force supposedly $250,000.00
ERISA appeal denial of benefits $184,000.00
Gerber sickness exclusion resolved $277,000.00
Denied life insurance claim Rhode Island $2,045,200.00
SGLI ex-wife versus child dispute $400.00/00
American General interpleader $300,000.00
Genworth prescription drug exclusion $109,000.00
Rhode Island life insurance and divorce $518,000.00
Nationwide autoerotic asphyxiation death $253,000.00
Rhode Island bad faith life insurance $629,000.00
AARP misrepresentation on application $301,900.00

How long can life insurance companies milk the period of contestability?

Life insurance, at its core, is a gamble. The life insurance company is betting that it will collect an appropriate amount of premiums from its policyholder for an appropriate amount of time so that when that policyholder dies, the payout will not exceed what the company has collected from that policyholder in premiums.

The policyholder is less of a conscious gambler in this scenario. While it would be a financial windfall to pay fewer premiums than his beneficiary ultimately receives when he dies, the policyholder really only cares that his designated beneficiary is taken care of after his death.

One particularly tricky period in the relationship between an life insurance company and its insured is what’s known as the “period of contestability.” Typically, this is a period that begins when the policy becomes effective and continues for exactly two years. If the policyholder dies during those two years, the insurance company can conduct all sorts of investigations into the cause of death and contest the viability of the life insurance policy on a number of bases.

These sorts of investigations are expected during the period of contestability and are well-respected by the law. Unfortunately, however, life insurance companies often manipulate the period of contestability to fit their own devices. Specifically, they will use a death that occurs during that period as an excuse to conduct endless “investigations” and to severely delay the payment of legitimate claims.

As attorneys who specialize in the wrongful denial of life insurance claims, we see this all the time. Insurance companies typically lose money when they have to pay a claim within the first two years of the policy period. Consequently, any time we are faced with a denial during that period, we are instantly suspicious of the life insurer’s motive.

This article examines the plight of one family who was caught in a period of contestability nightmare until they got the right lawyer involved.

A baffling death

The case involved a 48 year old man named Ken. Ken was exceptionally healthy for his age. He was a long-distance runner, ate healthy foods, didn’t drink or smoke, and rarely, if ever, got sick. He also visited his physician like clockwork at the beginning of each year in order to get a complete physical and take blood tests. Aside from minor injuries related to running, his examination and blood work always revealed that he was the portrait of health.

Ken had been married to his wife Kim since his early twenties. The couple never had children. Ken worked as a physician’s assistant at a large hospital and Kim was an aesthetician. They had a good marriage, a big house, lots of friends, and were always very active together. To most outsiders, it was the idyllic life.

Ken and Kim both had $500,000 life insurance policies that were supplied by Ken’s employer. Like many policy, Ken’s policy contained a two-year “period of contestability.” To the extent Ken or Kim ever thought about their life insurance policy terms at all, they certainly wouldn’t have been concerned about outliving the contestability period as they lived the healthiest of lifestyles and had no medical concerns whatsoever.

In September 2005, however, the unthinkable happened. Kim woke up at seven o’clock one morning and was surprised to see that Ken was still in bed. Typically he was up and out for his morning run by 5:00 am. When she leaned over to wake him, she was horrified to find that his body was cold and stiff. It was very clear that Ken had been dead for some time.

Kim immediately dialed 911 and within moments the police and paramedics arrived. Not surprisingly, Ken was declared dead at the scene. Given the unusual circumstances surrounding his death, a full autopsy report ensued. Though it took several weeks to get any word from the coroner, the final report revealed the following: (1) Ken did not have any drugs in his system at the time of death; (2) his body did not show any signs of disease such as cancer or heart disease; (3) he had no brain abnormalities; and (4) his cause of death was unknown.

No claim denial, just endless claim delay

In the meantime, Kim filed a claim for policy benefits with Ken’s life insurance company. The first correspondence she received in reply stated that the insurer was unable to process the claim until the coroner’s report was completed. Kim understood that, waited patiently, and forwarded the coroner’s report to the insurer once she had it. At that point, she expected the claim to be paid.

She was sorely disappointed, however, when the life insurer continued to stall. The company claimed that given that the cause of death was unknown and the policy was still in the contestability period, it had to conduct its own investigation before it could pay the claim. Months went by with no word. Kim called the insurer roughly every four weeks and never got any answers or any indication that payment would be made. Importantly, however, she never got an outright claim denial from the life insurance company even though a full year had passed since Ken’s death.

That’s when Kim called an attorney specializing in the denial of life insurance claims. The attorney was instantly familiar with the insurance company’s tactics – it was simply stalling as long as it could, hoping that Kim would stop asking for the money. When his calls to the insurance company on her behalf went unanswered, he and Kim decided to file suit.

Ultimately, the court was found the insurance company’s delays to be unreasonable. While the company certainly had the right to conduct its own investigation into Ken’s death, it was unable to show at trial that it had made any meaningful inquiry in the year since Ken passed. Kim was awarded full policy benefits, with interest.

If you are facing unreasonable delays from a life insurance company, please don’t hesitate to call our firm. We handle these types of cases all the time and we’re happy to help.

Rhode Island denied life insurance claims are nothing new. Existing for many years, life insurance policies have been used to safeguard families and friends alike in case emergencies or accidents come unexpectedly. Unfortunately, denials of life insurance claims, as well as delays, are commonplace.

Our life insurance lawyers who live and work in Rhode Island can help, whether you are in: Providence; Warwick; Cranston; Pawtucket; or anywhere in the state of Rhode Island, we will get you the benefits to which you are entitled.

Rhode Island Life Insurance Law

Policies through work are governed under ERISA. The primary regulating force here in Rhode Island is Title 27 of the Rhode Island Code, and oversight is provided by the Rhode Island Department of Business Regulation.

Most Common Reasons for a Denied Life Insurance Claim in Rhode Island

Number one is a misrepresentation on the application. This typically involves failing to disclose a medical condition. However, we can get over this hurdle the majority of the time.
A lapse of a life insurance policy is probably second most common. What happens is that the insured gets sick and misses a payment or two. These are tough, but often we can get these claims paid.
Probably third is the type of death exclusion. This could be a suicide or it could be a self-inflicted injury. Murder is another exclusion. Health again can fall under this exclusion. We often win suicide exclusions as we cite case law that the death was actually accidental.
A very common exclusion is the alcohol exclusion. The insured may have been killed in a car crash, but the autopsy revealed alcohol in the person’s system. We have many legal briefs to combat this exclusion.
Heroin and opiates or illegal drug exclusion is one of the biggest now. With the opioid crisis, there are tens of thousands of deaths.
Prescription drug overdose exclusion may involve an overdose of medicine or taken medicines that are contraindicated.
An ex-spouse being cut off from life insurance benefits is a big one. We actually have a half dozen ways to get over this hurdle.
Having a spouse not listed as a beneficiary is another reason for denial
Having a child not listed as a beneficiary is one too.
Having only a primary beneficiary who is deceased is another.
On an AD&D (accidental death and dismemberment) life insurance policy, a fall not being considered an accident is extremely common.
The insured’s age not being correct on the initial application is a reason for denial.
Having the wrong social security number listed is common.
An autoerotic asphyxiation exclusion is an easy one for us to beat.
An omission on the application is a big reason for denying a life insurance claim, but we have legal briefs to this effect.
Not providing the required documents to the insurance company after death is a reason.
Information which is argued to not be correct is one.
When there is a dispute between two or more beneficiaries, an interpleader may occur, and we always get these resolved quickly.
A beneficiary not named is a reason for not paying it out.
A life insurance policy may be transferred from one company to another by the employer which causes major problems.

Life insurance companies love accidental death riders

When accidents aren’t considered accidents by the insurer

As attorneys who specialize in the denial of life insurance claims, we have seen just about every justification an insurance company can possibly make for denying a claim. One of the most frequent and deceptive claim denials we see in our practice involves add-on insurance coverage such as accidental death riders (also known as “accidental death & dismemberment riders”).

Accidental death riders are intended to increase the death payout if the policyholder dies in an accident. For example, if the policyholder’s regular life insurance policy insures his life for $300,000, the death benefit might double to $600,000 if he dies as the result of an accident.

Life insurance companies love accidental death riders. Why? The reasons are twofold: (1) they know that an incredibly small percentage of the population ever dies in an accident; and (2) they have a knack for denying accidental death claims on the basis that the policyholder’s death wasn’t an accident – even if the coroner ruled that it was.

What this ultimately means is that the life insurance company happily collects additional premiums from its insureds, knowing that they will likely be able to avoid paying out on any claim made under an accidental death rider. In this article, we explore two real-life cases where life insurance companies denied claims made under an accidental death rider – only to later have that decision overturned by a court.

The “inherently dangerous activity” denial

Many accidental death riders contain an “inherently dangerous activity” clause. This clause basically says that if the insured dies while engaging in a dangerous hobby or sport, the insurance company doesn’t have to pay for accidental death coverage. Unfortunately, life insurers use this clause all the time to deny valid claims.

In one recent case, for example, the insured – a guy named Tom – died in a motorcycle accident. Police reports from the scene of the accident revealed the following: (a) Tom was driving at the legal speed limit on the freeway when the accident occurred; (b) witnesses reported that another driver changed lanes quickly without noticing Tom and knocked him and his bike off an embankment; (c) Tom was not at fault whatsoever in the incident. Autopsy results revealed that Tom was not under the influence of drugs or alcohol at the time of his death.

To most anyone, Tom’s death was clearly an accident. Indeed, his wife made a claim for death benefits under his regular life insurance policy as well as the accidental death rider (which would have doubled the policy payout). The family was shocked when the life insurance company denied the claim under the accidental death rider.

The insurer claimed that because Tom died in a motorcycle accident, he necessarily died engaging in an inherently dangerous activity. It didn’t matter at all to them that Tom was riding safely and legally during his regular commute to work. The insurer simply deemed motorcycle riding as dangerous and denied the claim on that basis.

That denial was eventually overturned in court. The court found that while some motorcycle riding can be inherently dangerous – such as when someone belligerently weaves in and out of traffic at high rates of speed – Tom was riding safely and legally when he died. The court also found it relevant that he was simply commuting to work when he died, as he had done every single weekday for the prior ten years.

Not only was the insurance company forced to pay the accidental death benefit to Tom’s wife, it also had to pay punitive damages for its bad faith claim denial.

The “intentional harm” exclusion

Another common provision in accidental death riders is the “intentional harm” exclusion. This clause comes in many forms but essentially says that if the insured dies while causing himself intentional harm, the insurance company does not have to pay an accidental death claim. Life insurance companies are experts at making unintentional acts seem intentional.

In another recent case, a 38 year-old woman named Melinda died while swimming in the local river. While the river was admittedly rough for most swimmers, Melinda was a competitive triathlete and had won multiple medals for fresh water swimming. On the day that she died, there was a swift and unexpected change in the current, which drug her underwater, causing her to drown.

Melinda’s husband made a claim for death benefits under her life insurance policy and accidental death rider. The insurer paid the amount due under the regular policy, but denied the accidental death payout. In its claim denial letter, the life insurance company stated:

We have determined that Melinda’s death was the result of intentional harm and not an accident. On the date of her death, Melinda chose to swim in very cold water under turbulent conditions. Any reasonable person would suspect that this activity was intended to cause self-harm, if not suicide. Because her accidental death rider excludes coverage if the policyholder dies which engaging in intentional harm, we must deny your claim.

Fortunately, Melinda’s husband did not give up when he received this letter. Rather, he took the insurance company to court and ultimately prevailed. The court found that Melinda’s long track record of swimming in like conditions obviated any argument that she was intentionally engaging in conduct that could be harmful to her. The insurer was forced to pay the accidental death benefit, along with the interest that accrued while Melinda’s husband pursued the claim in court.

When it comes to accidental death claims, we see these sorts of bogus denials all the time. Remember, the insurance company has a financial incentive to pay out on as few claims as possible. There more claims it can deny, the more profits its shareholders enjoy each year.

If you are facing the wrongful denial of a life insurance claim, please call us. We fight insurance companies on these denials every day and we have a proven track record of success. Call today. We’re here to help.