Life Insurance Lawyer Texas

Whether you reside in: Midland; McAllen; Killeen; Mesquite; Pasadena; Frisco; McKinney; Brownsville; Grand Prairie; Amarillo; Irving; Garland; Lubbock; Laredo; Piano; Corpus Christi; Arlington; El Paso; Forth Worth; Austin; Dallas; San Antonio or Houston; our life insurance attorneys who live and work here in Texas are here to help resolve your delayed or denied life insurance claim.

COVID-19 UPDATE: Our Texas life insurance attorneys are now handling numerous COVID-19 Coronavirus denied life insurance claims.

Death during a police chase: an accident or not?

Your life insurance policy may try to exclude coverage

When many people purchase life insurance, they are given the opportunity to purchase what’s known in the industry as an “accidental death rider.” The accidental death rider serves to multiply the policy’s death benefit payout – sometimes by as much triple the original amount.

Life insurance companies are happy to collect additional premiums from consumers who opt for the accidental death riders. After all, according to the Center for Disease Control, only about 50 out of every 100,000 deaths is the result of an accident. Of those, only a fraction of the decedents will have life insurance, and a smaller fraction will have an accidental death rider. In other words, these riders are a strong and low-risk way for life insurers to collect additional revenue.

Moreover, when an insured with an accidental death rider does die in an accident, life insurance companies are quick to deny claims on the basis that the underlying death was not an accident at all. Such was the case for the family of a Missouri man named John who was killed in an automobile accident.

A dramatic way to die

Prior to his death, John lived a bit of a dual life. On the one hand, he was known as a steady, hard working architect. While he didn’t have a wife or any children, he did take care of his extended family with great generosity. In fact, when he was offered a life insurance policy through his employer, he purchased a lucrative policy with an accidental death rider. John named his grandmother, Minerva, as the sole beneficiary under the policy.

The other side of John’s personality, however, was a bit more dubious. He had a fast sports car and liked to drive it at excessive speeds all around the small town where he lived in Missouri. In fact, at the time of his death, he had an outstanding warrant for several unanswered speeding tickets.

On the night he died, John was once again driving his sports car through town, though initially he was only going about 10 miles above the posted speed limit. It was at that point that a local sheriff’s deputy spotted him. While the officer probably would not normally have pulled someone over for exceeding the speed limit by just 10 mph, the deputy was familiar with John, with his habit of driving recklessly through town, and with his pending arrest warrants.

Consequently, the deputy turned on the flashing lights to his police cruiser, made a U-turn to position his car behind John’s, and activated the siren. John, likely aware that he would be arrested if he got pulled over, gave chase. He raced his sports car frantically through the city streets. Eventually, three police cruisers were on his tail and they watched as he had several near-misses with pedestrians and other vehicles. Witnesses estimated that John reached speeds of over 100 mph.

After around 20 minutes of erratic driving, John ended up colliding with another car that turned right in front of him without stopping at the stop sign for that intersection. John and the three occupants of the other car were all killed instantly. Later autopsy reports revealed that John was not under the influence of any alcohol or drugs at the time of his death.

A claim for benefits

Notwithstanding her overwhelming grief, John’s grandmother made a claim for benefits under John’s life insurance policy and accidental death rider. At the time, she had no reason to believe that the life insurance company would do anything but pay her the $400,000 death payout ($100,000 under the original policy, plus $300,000 under the accidental death rider).

A few weeks later, however, Minerva received a shocking letter in the mail. While the life insurance company agreed to pay the $100,000 payout under John’s principal policy, it refused to pay the $300,000 accidental death benefit. Minerva couldn’t believe her eyes. In her mind, John clearly died in an automobile accident.

The insurance company saw it differently. Its denial letter cited a provision in the accidental death rider that excluded coverage if the death resulted “directly or indirectly from committing an assault or felony.” The insurance company claimed John’s reckless driving and act of evading police constituted a felony. It also claimed that the death of the three passengers in the other vehicle was equivalent to an assault and denied coverage under the rider on that basis.

High dollars left on the table

Unfortunately, Minerva didn’t know much about the law and didn’t end up contacting a lawyer until the statute of limitations had run on any lawsuit she might have been able to bring against the life insurance company.

As attorneys who specialize in the wrongful denial of life insurance claims, we see unfortunate circumstances like these all the time. Had Minerva contacted our firm, we would have informed her that the language the life insurance company relied on in denying the accidental death benefits may not have been a valid basis for that denial.

To the contrary, many courts construe policy language in favor of the insured and against the insurance company. This means a court would have looked with suspicion at the insurer’s claim that John had committed a felony and/or an assault. In fact, the denial letter did not cite to any specific statute John was alleged to have violated. Certainly, John was never convicted of either crime, nor did any police report classify the accident as such. Indeed, it is possible that neither John nor the occupants of the other car would have died at all if the other car hadn’t run a stop sign.

This unfortunate situation simply underscores the importance of contacting an attorney specializing in the denial of life insurance claims any time you receive a claim denial that just doesn’t feel right or fair. If you’re in that situation, call us today. We’re here to help.

Texas 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 Texas can help, whether you are in: Houston; San Antonio; Dallas; Austin; Fort Worth; El Paso; Arlington; Corpus Christi; Piano; Laredo; Lubbock; Garland, Irving; Amarillo; Grand Prairie; Brownsville; McKinney; Frisco; Pasadena; Mesquite; Killeen; McAllen; Midland; Waco; or anywhere in the state of Texas, we will get you the benefits to which you are entitled.
Texas Life Insurance Law
Policies through work are governed under ERISA. The primary regulating force here in Texas is Title 28 of the Texas Administrative Code, and oversight is provided by the Texas Department of Insurance.
Most Common Reasons for a Denied Life Insurance Claim in Texas
  • 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 applications: what is a “material” misrepresentation?
The word “material” is material to the analysis
As attorneys who specialize in the denial of life insurance claims, we probably see one justification for claim denials more than any other – the allegation that the policyholder made a “material misrepresentation” in his application for life insurance. Insurance companies rely on this claim denial explanation for a few key reasons.
First, it immediately puts the beneficiary on the defensive at a time when that person is already grieving and overwhelmed. In some cases, the beneficiary didn’t even know the insured when the application was submitted and doesn’t know how to contest the allegation that a material misrepresentation was made. Additionally, the beneficiary may not have access to the underlying medical records needed to refute the allegation.
Insurance companies recognize these hurdles. They know that the more complex they make the claim denial, the less likely the beneficiary is to contest that denial. We find that reprehensible. Thus, in this article, we discuss the concept of “material misrepresentations” in depth and provide some insight for how such allegations can be successfully overcome.
What is a material misrepresentation?
Life insurance policies are nothing more than contracts between the insurance company and the policyholder. And, like other contracts, insurance policies must be premised on the truth. The parties to the policy cannot tell each other lies in order to make the contractual relationship seem more attractive. If one party does tell a lie during negotiations, and that lie is important enough that the other party wouldn’t have entered the contract if he knew the truth, that lie is said to be “material.”
In the life insurance context, policy applications are part of the contract negotiation process. The insurance company asks a series of questions about the potential insured’s background and health history and, based on the answers, makes a decision whether to issue a policy.
Material misrepresentations can occur when the potential insured is untruthful in answering those application questions. Let’s say, for example, that the questionnaire asks if the applicant ever smokes cigarettes and the applicant responds “no.” In reality, however, the applicant is a two-pack per day smoker. Let’s also say that the insurance company relies on the false answer and issues a life insurance policy, even though its own internal guidelines state that the company should never insure someone who smokes that much.
In that circumstance, the applicant’s lie is said to be “material” because in reliance on the lie, the insurance company did something it would not normally do – issue life insurance to a heavy smoker. If that policyholder later died of lung cancer and the insurance company found out the truth about his smoking habits, the insurer could validly deny any claim against his policy because of that material misrepresentation.
How does a life insurance company find a material misrepresentation?
When a policyholder dies and his beneficiary submits a claim for death benefits, the life insurance company will occasionally perform its own investigation into the circumstances of the insured’s death before they will pay a claim. This process is sometimes referred to as “reverse underwriting.”
Sticking with the above example, when the policyholder died, his beneficiary would need to submit a claim form, along with a death certificate and an autopsy report. The insurance company would undoubtedly note that the insured’s cause of death was listed as “lung cancer.” It would then go back to the insured’s application to see whether he admitted to being a smoker. In this case, we know he denied being a smoker.
Given the strong correlation between smoking and lung cancer, the insurance company would probably then take its investigation further. For example, it might request additional medical reports or review the insured’s social media files for pictures of that person smoking. Once the insurance company is confident that the insured lied about such an important issue it would undoubtedly deny the claim on the grounds of the material misrepresentation.
In this example, that is probably a valid decision by the insurance company that should not be contested.
How can the material misrepresentation allegation be successfully overcome?
Not all cases are so black and white, however. In fact, insurance companies can be downright deceptive in their reliance on material misrepresentations. Let’s use a different example to illustrate this point. Imagine that the policy application asked if the applicant engaged in any dangerous hobbies and he responded “no.” In truth, however, the applicant was an avid backpacker – a sport that some people consider dangerous.
A policy is issued and the insured later dies in a car accident. In performing its reverse underwriting investigation, the insurance company finds pictures of the policyholder on a backpacking trip. It denies his beneficiary’s claim for death benefits, claiming that his misrepresentation about not engaging in dangerous hobbies was a material misrepresentation.
While the policyholder’s application may have contained a mistruth, the lie must be “material” in order to justify a claim denial. Again, that means the lie had to be so substantial that the insurance company would have refused to issue a policy had it known the truth. In this example, it is highly unlikely that the insurance company would not have issued a policy to a backpacker. Consequently, the misrepresentation was not material and the claim denial should undoubtedly be contested.
While the two examples in this article are extreme, material misrepresentation battles are fought with life insurance companies all the time. The ultimate point is that life insurers cannot deny claims on this basis unless the mistruth was, in fact, material. That is often an intricate analysis that is best handled by lawyers who specialize in the denial of life insurance claims.
As specialists in life insurance claim denials, we fight these battles all the time. We know how to obtain the records you need to contest the denial. We know the games insurance companies play. Perhaps most importantly, we know which denials have the best chance of being successfully overturned. If you’re facing this situation, call us today. We’re here to help.