Articles Tagged with: life insurance claim denied
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January 13, 2023

A Guide to Handling Your Life Insurance Claim Denial Appeal

You think you know how life insurance works – your loved one purchased a life insurance policy so that if something should happen to them, you would get a payout. Unfortunately, the process is rarely that straightforward.

Like any other business, life insurance companies seek to make a profit. They only make money for their shareholders when they collect more in premiums than they pay out in death benefits. For this reason, they are quick to deny claims that are later proven to be valid.

Was your life insurance claim denied? We make it our business to get out clients paid. Call us to discuss your case.

First, Get the Life Insurance Claim Denial in Writing

If your life insurance claim was denied over the phone, ask to have it in writing. As a life insurance beneficiary, you are entitled to a full explanation of why your claim was denied, in writing. The letter should outline the reasons your claim was denied as well as applicable policy provisions, legal theories, and regulations or statutes.

When you receive the denial letter,  the life insurance company should also include instructions for disputing the denial. The claims appeal process may also be explained on the life insurance company’s website. Appealing a denied life insurance claim may be an internal process or may involve filing an administrative law case or a legal complaint.

Second, Understand Why Your Life Insurance Claim was Denied

While the denial letter should explain the reason your life insurance claim was denied, many denial letters are simply form letters with no specificity. Contact the life insurance company and ask for a complete explanation. If they refuse to provide a written explanation for your claim denial, contact an experienced life insurance attorney for help.

Common reasons life insurance companies deny claims include:

  • Errors on the insured’s application or medical questionnaire, alleged misrepresentation
  • Failure to pay premiums, causing lapse in coverage
  • Group life insurance policy not converted to individual policy
  • Cause of death allegedly excluded from coverage
  • Death from self-inflicted wounds
  • Death from drug overdose
  • Death from alcohol poisoning
  • Death during an illegal act
  • The insured’s spouse or ex-spouse filed a beneficiary dispute
  • Insufficient proof of death overseas

An experienced life insurance attorney will investigate and find out if the reason given for denial of your claim actually applies. In many instances, a claim that is initially denied may be paid when an investigation shows that the insured was not at fault.

For example, if the insured was eligible for disability waiver of premiums and did not receive that waiver, the lapse in coverage was not the insured’s fault and you should still get the death benefits. Similarly, if the life insurance company cannot show that they sent the legally-required lapse notices to the insured, you should still get paid.

Maybe the insured made an innocent mistake on their medical questionnaire that the insurance company now alleges was fraud intended to get the insured a lower premium payment. In these cases, the insurance company may settle for paying the death benefits minus what the insured would have paid in premiums had the insured not made that error.

All too often, life insurance companies are quick to deny claims that are valid. Do not take no for an answer!

Third, Seek the Help of a Life Insurance Beneficiary Lawyer

There can be no doubt that working with an experienced life insurance attorney will improve your chances of getting a life insurance payout. Life insurance lawyers generally work on contingency, meaning that there is no out-of-pocket expense to you and that they do not get paid unless you do. Your initial case consultation will be free of charge.

Life insurance is highly regulated at both the state and federal levels. Sometimes the laws of more than one state apply. Group life insurance through an employer is governed by ERISA, requiring that you file a formal administrative appeal. In addition to investigating the circumstances of the claim denial and helping you locate and obtain information and documentation, your life insurance lawyer will know and follow all applicable regulations, laws, and legal procedures.

The life insurance company has a team of lawyers on their side, working to further their interests. Shouldn’t you have a team of experienced life insurance lawyers on your side too?

Call us today at 1-855-898-4158 for your free, no-obligation consultation.

January 12, 2023

Life Insurance Not Paying for COVID-Related Death?

If you are the beneficiary of a life insurance policy, and your life insurance claim was denied in COVID-related death, don’t take no for an answer. The life insurance attorneys at Boonswang Law have helped thousands of beneficiaries fight insurance companies. Let us help you get paid the money you are owed!

Life Insurance Companies Have No Incentive to Pay You—Even If COVID-19 Was the Cause of Death.

Life insurance is supposed to work like this:

  1. The insured fills out an application and medical questionnaire.
  2. The insurance company writes a policy for the insured that specifies the term of coverage and the coverage amount.
  3. The insured pays life insurance premiums as they come due.
  4. The insured dies within the policy term.
  5. The insurance company pays the death benefit to the named beneficiary or beneficiaries.

However, life insurance companies only make money for their shareholders when they don’t pay beneficiaries’ claims for death benefits. For this reason, insurance companies will find any possible way to deny a claim or delay payment on a claim.

Unfortunately, life insurance companies are now denying and delaying payouts on life insurance claims when the insured died from the coronavirus (COVID -19). Social media is rife with stories about insurance companies::

  • Requiring beneficiaries to send and resend paperwork;
  • Requiring beneficiaries to send extra documentation;
  • Delaying payout because the death is being investigated;
  • Delaying responses to beneficiaries’ inquiries.

Contact Boonswang Law if the life insurance company is treating you this way, or if your claim is in any other way being delayed, or if your claim was denied. Not only can we help you get your life insurance claim paid, but we can also force the insurance company to pay you interest on the death benefits if the delay in paying your claim was unreasonable.

Should Life Insurance Pay When the Insured Dies from the Coronavirus (COVID-19)?

Yes. COVID life insurance coverage should not be in question. While newly-written policies may have a pandemic exclusion, there was no life insurance exclusion for COVID in the first nine months of 2020, during which, presumably, the insured died.

However, life insurance companies are taking advantage of the medical community’s relative ignorance regarding coronavirus and alleging that the insured’s cause of death was an undisclosed pre-existing condition or an undisclosed lifestyle habit. Life insurance companies will also take any opportunity to deny a claim during the first two years of a policy, called the contestability period, if there were any mistakes or omissions on the insured’s application or medical questionnaire.

Insurance companies will also delay payment on a claim if they have to investigate the cause of death. While some coroners will record the cause of death as “complications from COVID-19,” others will specify the particular complication, such as pneumonia, respiratory failure, multi-organ failure, or septic shock.

If the insurance company is delaying payment on your COVID life insurance claim, be sure to review the death certificate and confirm that COVID-19 is cited as the cause of death. Why? So that the insurance company can’t deny your claim alleging that the cause of death was something other than COVID-19.

The Reasons Life Insurance Claims Are Denied for COVID

Claim Denied Due to Alleged Misrepresentation by the Insured Who Had Covid

If the insured omitted or lied about having a medical condition or lifestyle habit that could affect the insured’s ability to survive contracting the coronavirus, the insurance company will seize on this as a reason to deny your claim.

Underlying conditions such as diabetes, heart disease, and chronic lung disease render someone more vulnerable to COVID-19. Smokers are also more vulnerable to COVID-19.

If the insured did not disclose something on their initial application or medical questionnaire, the insurance company will allege that the death was due to a non-disclosed condition or habit and can and will deny your claim.

Claim Denied Because the Insured Died From Coronavirus During the Life Insurance Contestability Period

During the two-year period following the purchase of a life insurance policy, the insurance company will deny a claim for death benefits if the insured made even a small mistake on their initial application or medical questionnaire. Your claim will likely be denied even if the cause of death had nothing to do with the mistake.

Common errors or omissions that the insurance company will claim is misrepresentation include:

  • Wrong date of birth or age;
  • Failure to disclose past or present disease, illnesses, or conditions;
  • Failure to disclose past or present injuries, surgeries, or disabilities;
  • Failure to disclose past or current smoking, or alcohol or drug abuse;
  • Failure to disclose engaging in risky activities or hobbies;
  • Failure to disclose travel to a high-risk destination.

If you or someone you know is abusing alcohol or drugs call the Substance Abuse and Mental Health Services Administration (SAMHSA) hotline at 1-800-662-HELP (4357) for free and confidential help, 24 hours a day.

This means that even if the insured’s alleged misrepresentation had nothing to do with COVID-19, your claim will be denied on a technicality during the contestability period. Fortunately, in many instances where the mistake had nothing to do with the insured’s cause of death, we’ve been able to litigate a full payout or settlement with the insurance company.

Call us if your claim was denied due to alleged misrepresentation, and the insured had the coronavirus. Let us help you fight back and get paid.

Claim Denied Because the Insured Died of Coronavirus After the Policy Lapsed Due to Nonpayment of Premiums

An insurance company is required to pay death benefits to the beneficiaries if the insured dies within the policy term and has paid all of their premium payments. If the insured does not pay premiums when due, their life insurance policy lapses or terminates. An insurance company will deny a claim for death benefits on a lapsed or terminated policy.

It is very common for policies to lapse due to circumstances outside the insured’s control. We have gotten thousands of claims paid in those instances.

For example, if an insured was hospitalized and did not receive the required lapse notices from the insurance company, we have litigated those cases and gotten the claim paid. If an insured had group life insurance through an employer, and the employer allowed the policy to lapse or failed to provide the insured with the required paperwork to transfer to an individual policy, we can get that claim paid. If the insurance company or employer failed to send the notices required by state statute, we can get that claim paid. If the insured was disabled and eligible for a premium waiver, but did not receive a premium waiver and the policy lapsed due to non-payment, we can get that claim paid.

Did the insured die from COVID-19, and your claim was denied because the policy lapsed? Call us. We can determine whether the lapse was the insured’s fault, or the fault of the insurer.

The Life Insurance Beneficiary Lawyers at Boonswang Law Can Help You with Life Insurance COVID Claims.

If your claim is delayed or has been denied, do not give up! We know all of the insurance companies’ tricks and how to fight them. Gather the paperwork you’ve received, your claim application, the insured’s death certificate, and schedule your free case evaluation. We can get claims paid when the insured died after having contracted the coronavirus. Our experienced life insurance attorneys will review your case and discuss your options with you at no cost. Let us help you fight the insurance company.

January 12, 2023

Life Insurance Claim Denied Due to Smoking?

Unfortunately, one of the most common reasons insurance companies refuse to pay a life insurance claim is because the insured smoked, but did not disclose their past or current smoking habit on their initial life insurance application and medical questionnaire.

If your claim was denied due to smoking, we can help. Often it is a matter of showing that there was no fraudulent intent on the part of the insured, or that a past smoking habit had nothing to do with the insured’s cause of death.

Don’t take no for an answer if payment was denied because the insured allegedly lied about smoking. The experienced life insurance lawyers at Boonswang Law have helped thousands of beneficiaries get paid when the insured was a smoker by appealing the life insurance claim denial. Contact us for your free, no-obligation case evaluation. We don’t get paid unless we win, so let us help you.

Claim Denied Due to Death within the Contestability Period

The two-year period following the date of purchase of the life insurance policy is called the contestability period. During the contestability period, an insurer can deny beneficiaries’ claims for any mistake or omission they made on the initial life insurance application or medical questionnaire, even if the mistake or omission had nothing to do with the insured’s death.

For example, if the insured did not disclose that they had a smoking habit years ago, and quit, then died of injuries sustained in a car accident during the contestability period, the insurer can deny your claim. If the insured failed to disclose that they currently smoke, and was shot and killed in a hunting accident, the insurer can still deny your claim.

When the alleged misrepresentation is not “material” to the insured’s cause of death, we can often get your claim paid.

Claim Denied Due to Misrepresentation

If the insured died outside the contestability but the cause of death could be linked to undisclosed smoking, your life insurance claim will likely be denied due to misrepresentation. The reason insurers are permitted to deny such claims is that as a matter of public policy, people applying for life insurance should be dissuaded from lying about their health or lifestyle habits just to get a lower premium payment.

We have gotten many such claims paid because we can show that the insured did not act with fraudulent intent in failing to disclose smoking. We have also gotten claims paid when the insured’s smoking habit had nothing to do with the cause of death.

Case Study – If No Intent to Deceive, No Misrepresentation

Where an insured died of natural causes but the insurer denied the claim because questions on the initial application were not answered correctly, we were able to get that claim paid because those answers did not show that the insured acted with the intent to deceive, and the answers were not material to the insured’s cause of death.

Claim Denied Due to Agent Mistake or Negligence

It is all too common for an insurance agent to complete an application and medical questionnaire on behalf of the insured, to make a mistake that the insured does not find or know about, and then for the insurer to deny beneficiaries’ claims due to alleged misrepresentation on the part of the insured.

Case Study – Settling for the Death Benefits Minus the Increase in Premiums the Insured Would Have Paid.

An agent made a mistake that recorded the applicant’s age as seven years younger than he was. We were able to get our beneficiary client paid the death benefits minus the amount the insured would have paid in premiums had his age been recorded correctly. This same theory might apply to get you paid when the insured smoked, but did not disclose it on the application.

Case Study – Agent Negligence or Mistake.

An insured disclosed to his agent that he used to smoke but quit a few months prior. His agent responded that the question about smoking did not apply because the insured had recently quit. The agent also did not record related information about the applicant’s COPD and Hepatitis C. The insured signed the application verbally and did not have a chance to proofread the agent’s work.

Although the insured died from smoking-related complications, the agent knew about past smoking and present related conditions yet did not record them. We got our client beneficiary paid because the insurance agent’s knowledge is imputed to the insurance company.

Don’t Take No For An Answer! We Can Help Get You Paid When the Insured Smoked

The life insurance beneficiary lawyers at Boonswang Law have dealt with thousands of claim denials over the years, and smoking has figured prominently among the reasons for denying a claim. What might seem like a cut-and-dried case of lying on the part of the insured may be an innocent mistake, a mistake or negligence by the insurance agent, or have nothing to do with the cause of death. In any case, we will find out and help you fight back.

Have questions about life insurance claims being denied due to vaping or occasional cigar smoking? We can help you with that too. Call us and find out how to appeal your life insurance claim denial.

January 12, 2023

Life Insurance Claim Denied Due to Alcohol Consumption?

Can the life insurance company deny your claim because the insured used alcohol? The short answer is yes, claims for death benefits are frequently denied unfairly when alcohol is involved.

Was your claim for death benefits denied because the insured used alcohol? Was the insured’s death from complications from alcohol abuse? Was the insured intoxicated when they died, but their death had nothing to do with alcohol use or abuse?

In many cases where the life insurance company denied beneficiaries’ claims due to the insured’s alcohol use, we can help you get your claim paid by appealing the life insurance claim denial. Let the experienced life insurance beneficiary attorneys at Boonswang Law fight for you. There is no cost unless we win.

If you or a loved one is struggling with alcohol abuse, call the Substance Abuse and Mental Health Services Administration (SAMHSA) hotline at 1-800-662-HELP (4357) for free and confidential help, 24 hours a day.

Why Insurance Companies Routinely Deny Life Insurance Claims Due to Alcohol Consumption.

Insurance companies make money for their shareholders when they deny life insurance claims. For this reason, they will grasp at any reason, however unlikely, to deny your claim initially.

Does Alcohol Affect Life Insurance?

Yes, alcohol consumption can affect whether a life insurance policy is paid, or whether an applicant for insurance can get coverage.

If an insured discloses on their initial application for life insurance that they use alcohol, the insurance adjuster will take that into consideration when writing the policy. Life insurance companies often justify their life insurance claim denials by arguing that alcohol use can affect the amount in premiums an insured will pay, and may even result in denial of their application.

Will Life Insurance Pay Out for an Alcohol-Related Death?

In some cases, life insurance will pay out after the death of an insured who suffered from alcoholism. If the insured died of causes wholly unrelated to alcohol use or abuse, it is often possible for an attorney to get that life insurance claim paid.

What Can Be the Reasons for Rejection of a Death Claim Due to Alcohol?

Here are the types of death not covered by life insurance when alcohol is involved:

The Policy has an Alcohol Intoxication Exclusion

In about half of all states in the U.S., life insurance companies are permitted to add an exclusion to policies to exclude deaths directly or indirectly related to alcohol use from coverage. If the insured is intoxicated and dies for any reason, the insurance company will deny your claim under this exclusion.

Misrepresentation on the Initial Application and Medical Questionnaire

If the insured omits mention of alcohol use, or fails to disclose past or current alcoholism, and the death of the insured was in any way related to alcohol use, the insurer will likely deny your life insurance claim for death benefits because of alleged misrepresentation on the part of the insured.

We can sometimes resolve these claims for the amount of the death benefit minus the amount the insured would have paid in premiums had the underwriter known that the insured used alcohol.

The Insured Died During the Contestability Period

If the insured dies within two years of purchasing the policy, the insurer will grasp at any reason to deny your life insurance claim, even if that reason has absolutely nothing to do with the cause of death.

For example, if the insured failed to disclose that they used alcohol socially, and then dies of something having nothing to do with alcohol use, such as mesothelioma, the insurer may allege that the insured misrepresented himself and deny your life insurance claim.

We are frequently able to get these claims paid, especially if the death was unrelated to alcohol use or abuse.

The Insured Died While Doing Something Illegal

If the insured died while doing something illegal – for example, drinking and driving – the insurer will deny your life insurance claim under the illegal act exclusion. If the insured had a few drinks at a friend’s dinner party, mistakenly trespassed on a neighbor’s yard on the way home, and was struck by a falling branch and killed, the insurer may use the few drinks to deny your life insurance claim.

Let the Life Insurance Beneficiary Attorneys at Boonswang Law Fight for You!

If your claim has been denied for an alcohol-related reason, do not give up! There are many circumstances under which we can get that claim paid or even negotiate a settlement for you.  Keep in mind that we take cases on a contingency basis, meaning that we do not get paid unless we win. Contact us for your free, no-obligation consultation. Let us help you fight the life insurance company.

January 12, 2023

Life Insurance Claim Denial Appeal

Can you appeal a life insurance claim denial? Yes!

Are you a life insurance beneficiary whose claim was denied? This article will explain exactly what to do if your claim for death benefits was denied, how to appeal insurance claim denial, and how to win an insurance appeal. Don’t take no for an answer! 

If your life insurance claim was denied, our life insurance lawyers can help you. We’ve helped beneficiaries around the country get their life insurance payout after their claim for death benefits was initially denied. Call us for your free, no-obligation case evaluation. Our life insurance attorneys work on contingency, which means we don’t get paid unless you do.

The Typical Life Insurance Claim Process

A loved one dies and you discover you’ve been named as a beneficiary to a life insurance policy. You go online, complete the claim form, and within 30 days the life insurance company will notify you that they either approve and will pay your claim, deny and will not payout, or that one of the many reasons a life insurance claim is delayed applies.

What to Do if Your Life Insurance Claim is Delayed

A claim may be delayed for any number of reasons the life insurance company require further investigation, including:

  • The insured was murdered
  • The insured died overseas
  • There is a life insurance beneficiary dispute
  • There was a last-minute life insurance beneficiary change
  • The insured died during the contestability period
  • The primary beneficiary is deceased or cannot be found
  • The insured failed to name ex-spouse as a beneficiary in a community property state
  • The insured named an ex-spouse as beneficiary in a revocation-upon-divorce state
  • The insured used marijuana and it is unclear whether that use was legal or prescribed

If your claim is delayed, you need the help of an experienced life insurance lawyer to get your payout. Insurance companies only make money for their shareholders when they don’t pay claims or delay paying claims, so they have little incentive to pay you or pay you timely. So-called “investigations” into the death of the insured can take months or even years. Don’t be a victim of the life insurance company! Call us for your free evaluation.

Why Do Life Insurance Companies Deny Claims?

There are many reasons a life insurance company claim is denied, including:

  • Claim denied because life insurance lapsed or terminated due to nonpayment of premiums
  • Claim denied due to misrepresentation on the application for life insurance
  • Claim denied due to alcohol use by the insured
  • Claim denied due to drug use by the insured
  • Claim denied due to smoking
  • AD&D claim denied because the death was not accidental;
  • Claim denied due to Acts of War or Terrorism
  • Claim denied because the death was excluded from coverage;
  • Claim denied due to suicide of the insured
  • Claim denied because the insured died overseas
  • Employer-provided group life insurance claim denied because employer failed to provide conversion forms to the insured and the policy lapsed
  • Claim denied because the insured was eligible for disability waiver of life insurance premiums, did not get the waiver, and the policy lapsed

If your life insurance claim was denied, you are afforded the opportunity to appeal life insurance claim denial. Here’s how.

How to Appeal in the Case of Life Insurance Claim Denial

When you receive the life insurance claim denial letter from the life insurance company, read it carefully. Does it provide a clear reason for the claim denial? If not, call or email them for an explanation. They must provide one. If an appeal form was not included with your denial letter, ask to be sent that form or where the form is located online.

How to Write an Life Insurance Appeal Letter

Wondering how to write an appeal letter to the insurance company? You will need to include the policy number, the full name and address of the insured, the date of death, and attach a death certificate. You will also need documents to support your assertion that your claim should be paid.  The best way, however, is to contact a lawyer at Boonswang Law to help you with your appeal.  They take care of all the intricacies involving the appeal for you.

An insurance claim appeal is a legal process. There are procedural requirements and deadlines, and these vary by state and by policy. If you try to appeal on your own and make a mistake, that may affect what a life insurance lawyer can do for you thereafter.

What you should do is get the help of an experienced life insurance attorney as soon as you get your denial letter. Our life insurance attorneys are the best in the country and handle all of the paperwork, forms, and documentation, investigate the denial, and make sure you present your best case. We have gotten beneficiaries paid nationwide and are familiar with the life insurance laws in every state as well as the policies of every life insurance company. Put our experience to work for you so you have the best chance of getting a payout.

The Process of Appealing a Denied Employer Group Life Insurance Claim

Appeal of a claim denial of employer-provided group life insurance is governed by the federal Employment Retirement Income Security Act of 1974, known as ERISA, 29 U.S.C. §§ 1001-1461. This statute supplies, among other things, the procedure for appealing a life insurance claim denial.

You must file what is called an “administrative appeal” within a certain period following the life insurance claim denial letter. If that administrative appeal fails, you will have the opportunity to litigate in court, but the information and documents you submit in the administrative appeal will be relied upon by the court.

For this reason, it is essential to thoroughly investigate and perform legal research on the merits of your claim prior to the administrative appeal, again, to give you the best chance of overturning the claim denial.  Most importantly, call Boonswang Law to assist you with your ERISA appeal.  It is vital that the appeal be performed properly in order that your rights are protected at all times.

Our experienced ERISA attorneys can help get your life insurance claim paid upon an administrative appeal and are prepared to litigate for you if the administrative appeal is unsuccessful.

Our Life Insurance Beneficiary Attorneys Can Help You Appeal Your Denied Life Insurance Claim

If you feel your life insurance claim was unfairly delayed or denied, call us. We will thoroughly review your case free of charge, and if we decide to take your case, know that we expect to win!

January 12, 2023

Autoerotic Asphyxiation Life Insurance Claim Denied

Sometimes the way a loved one dies exacerbates the grief of friends and family members. Autoerotic asphyxiation can be one of those causes of death, but life insurance beneficiaries often have more problems to deal with than their embarrassment or shame when an insured dies that way.

Was your life insurance claim denied when the insured died of autoerotic asphyxiation? Our life insurance attorneys can help. We’ve investigated these types of life insurance claims and helped beneficiaries in your circumstances appeal life insurance claim denial and get their life insurance payout. Let us help you during this difficult time.

Death by Autoerotic Asphyxiation Can Look Like Suicide

Because autoerotic asphyxiation involves strangling oneself, the circumstances of the death give the life insurance company the opportunity to deny a life insurance claim due to suicide.

A life insurance company can deny a claim for death benefits due to suicide if the insured allegedly committed suicide during the contestability period or if suicide is expressly excluded from coverage in the life insurance policy.

Case study: we got our client beneficiary paid when the insured died of autoerotic asphyxiation. The insured was found in his hotel room, and the life insurance company denied the claim for death benefits, alleging the insured committed suicide. We investigated and were able to show that the insured intended to survive, as he had laid out his clothing for the next day.

Death by Autoerotic Asphyxiation During the Contestability Period

The life insurance contestability period is the two years following the purchase of a life insurance policy. During that period, the life insurance company has heightened power to deny claims for death benefits due to any errors or misrepresentation on the life insurance application, or if the insured allegedly committed suicide, even if the policy does not contain a suicide exclusion.

We have gotten beneficiaries paid when their claim was denied due to death during the contestability period, especially when the alleged misrepresentation had nothing to do with the cause of death. Call us for your free case evaluation.

Death by Autoerotic Asphyxiation When Suicide is an Exclusion

Every life insurance policy has “exclusions” that provide which causes of death are not covered by the policy. Typical exclusions are death by Act of War or Terrorism, suicide, and death while engaging in sports or activities that the life insurance company considers dangerous.

Death by autoerotic asphyxiation is usually an accident. We will thoroughly investigate the circumstances of the death of the insured and if we can show the death was accidental and not suicide, you will get your payout.

What is Autoerotic Asphyxiation?

Autoerotic asphyxiation is achieved when someone masturbates while cutting off oxygen to their brain, commonly using a noose around their neck, to enhance an orgasm. When the person passes out from lack of oxygen, they release their grip on the noose and it loosens, allowing them to breathe normally. Sometimes the noose fails to loosen and the person dies accidentally.

What is Erotic Asphyxiation?

Erotic asphyxiation is the same practice as autoerotic asphyxiation but the choking is done by someone to their partner. That other person can be choking their partner manually or employing a noose. One would think that this would be a safer practice than autoerotic asphyxiation because one partner remains conscious and can ensure that the choked partner regains consciousness.  Sometimes, however, things go wrong and people die.

In these cases, if the insured dies of erotic asphyxiation, the life insurance company will likely delay paying the life insurance claim to investigate for homicide, especially if the insured’s partner was the beneficiary of the life insurance policy. This is especially the case if the insured’s partner is suspected of murder, accused of murder, or indicted for murder.

Was your life insurance claim denied due to death by erotic asphyxiation? Call us for your free, no-obligation consultation. We help beneficiaries get paid.

Lawyer to Help with Life Insurance Claim Denied Autoerotic Asphyxiation

Most death by autoerotic asphyxiation is accidental, but life insurance companies will invariably take advantage of the opportunity to deny or delay your claim for death benefits, hoping you will be too embarrassed to fight back.

Don’t take no for an answer! Call us for your case evaluation and find out whether you can get your life insurance payout.

January 12, 2023

4 Most Common Reasons Why Insurers Deny Life Insurance Claims

What Are the 4 Most Common Reasons Insurers Deny Life Insurance Claims?

If you have a life insurance policy to provide your loved ones with financial benefits after your death, it’s important to do what you can to ensure they get everything they’re entitled to. The best way to do this is to learn the most common reasons for rejecting claims and take steps to avoid these issues. Consider the top four reasons for insurance companies to deny life insurance claims.

Did the Death Happen During the Contestability Period?

Insurers in Pennsylvania are allowed to have a two-year contestability period. During this time,  your insurer will look into the details of any death that occurs. This may mean they heavily scrutinized your application to ensure it was accurate. They could deny the claim if they find anything misleading, or even if your death is ruled a suicide since this could indicate that you only bought insurance to allow your family to collect money after your death.

Was the Type of Death Covered?

When you sign up for your policy, you should review it to find out if any causes of death are not covered. For most policies, natural causes of death are covered. But if you die while performing a risky hobby or committing a crime, your death might not be covered, depending on your policy. On the other hand, if your death is considered a murder, it will be covered as long as your beneficiary is not suspected of homicide. Additionally, suicide is typically covered after the two-year contestability period is over.

Were the Premiums Current?

Another reason for claim denial is when the policy lapsed because the latest premium wasn’t paid. If your premium is late, you may get a brief grace period and a reminder from the insurance company to pay. But if you ignore it or don’t get this notice, the policy could end, which may be a shock to your family after you pass away. You can prevent this issue by automating your payments.

Were You Completely Honest on the Application?

One of the most preventable problems with life insurance is dishonesty on the application. Simply put, if you lie or leave out important details, you might get a policy that you pay premiums on for years, but the claim could be rejected once you pass away and the insurer realizes you lied. Therefore, it’s best to be honest about your medical conditions. You also need to disclose any dangerous hobbies you enjoy or risky jobs you do. This will allow you to get a life insurance policy that truly protects your family in the future.

If you have questions about the legality of a policy or want to ensure your life insurance company isn’t violating your rights, contact an attorney with experience handling claims like yours. Contact our law office in Philadelphia at
(215) 940-8900 today to learn how we can help.

January 12, 2023

16 Reasons Life Insurance Won’t Pay Out

People purchase life insurance policies to protect their families and dependents in the unfortunate event of their death. Life insurance policies are valid, legally binding contracts between policyholders and life insurance companies. So, why is the life insurance company not paying out?

These are the sixteen most common reason life insurance companies deny claims:

  1. Nonpayment of Premiums
  2. Death during the Contestability Period
  3. Misrepresentation on Application
  4. Employer Failed to Submit a Disability Waiver of Premium
  5. Problems with the Beneficiary
  6. Policy was included in a Trust or a Will
  7. Denials Due to Suicide Exclusion
  8. Policy Included a Drug or Alcohol Exclusion
  9. Death Due to other Policy Exclusion
  10. Death Due to Act of War or Terrorism
  11. Death Resulted from Extreme or Dangerous Activities
  12. Death Due to Homicide
  13. Death While Living or Traveling Abroad
  14. Policyholder Dies Committing an Illegal Act
  15. No Insurable Interest
  16. New or Replacement Policy

Just because your claim was initially denied does not mean you do not have a valid claim. You must fight the life insurance company when they deny your claim. Call our experienced life insurance lawyers at 855-553-9010 to discuss the specifics of your life insurance policy and learn about your options – free of charge

Remember, life insurance companies only make money for their shareholders when they collect premiums and deny or delay paying valid life insurance claims. Here are the sixteen most common reasons life insurance won’t pay out.

1. Nonpayment of Premiums

When the life insurance premiums are unpaid, life insurance coverage lapses, the policy terminates, and claims for death benefits get denied. However, our experienced life insurance lawyers have gotten many beneficiaries paid under these circumstances, especially when nonpayment of premiums is not the policyholder’s fault.

When you buy a life insurance policy, the insurance company’s obligation to pay out is contingent on the policyholder having paid the premiums. If you forget to pay, the insurance company typically provides a “grace period” for making late payments of around one month from the due date. If you do not pay within the grace period, the policy “lapses,” and you will no longer be covered. Even if you’ve been paying diligently for decades, your policy can be terminated after missing one premium payment.

Often, nonpayment of premiums is not the policyholder’s fault. For example, the life insurance company may not have sent the legally-required notices of impending lapse, or cannot show that the policyholder received them.

Lapse in Coverage because Employer Stops Paying Premiums

Sometimes policy lapse and termination happens through no fault of the insured. For example, if ERISA controls, there are many safeguards in place for an insured who does not receive the required notices and application for conversion from their employer, and their employer simply stops paying premiums on their behalf. Beneficiaries can get paid even if the policy lapsed in these circumstances!

Lapse in Coverage because the Employee Went Out on Disability

Again, there are notices that the employer is required to provide an employee if the employee is out of work on disability. The employer may not simply stop paying premiums. The disabled employee may be eligible for waiver of premiums due to disability and their employer should provide them with that application.

Lapse in Coverage Because the Employee Was Unable to Convert the Policy

When an employee leaves a job with group life insurance, they have the option to convert that coverage to an individual policy. Unfortunately, not all employers effectively administer their group life insurance plan, and either the necessary paperwork is not given to the employee or that paperwork is not properly completed or filed with the life insurance company.

2. Death During Contestability Period

In most states, the first two years of a life insurance policy are considered the “contestability period.” If the policyholder dies shortly after purchasing life insurance during the contestability period, the life insurance company has the right to review and fact-check information on a life insurance application for accuracy. They perform a full investigation of the policyholder’s medical records and any other information requested on the application.

If the life insurance company finds any false statements or omissions, they have the power to  retroactively cancel the policy and refund premiums instead of paying the beneficiaries’ claims for death benefits.

Unfortunately, this is a common tactic among life insurance companies, even when the misrepresentation in question is unrelated to the insured’s death. All too frequently, otherwise valid life insurance claims are denied due to an innocent mistake on the application.

Do not take no for an answer! Our life insurance lawyers investigate alleged misrepresentation and are often able to get our clients paid. For example, we got our beneficiary client paid in full when the insured died within the contestability period of heart failure.  We argued that the insured had no history of heart failure, did not know they had a heart condition, and could not have disclosed an unknown heart condition.

Death Due to Self-Inflicted Injuries During the Contestability Period

Most life insurance policies contain a two-year “suicide clause,” in which claims can be denied in the event of a policyholder’s suicide. This clause deters people from buying policies with the intention of committing suicide shortly afterward, thereby leaving large life insurance benefits for their family members.

Know that if there is even a possibility that the policyholder died from self-inflicted injuries, the life insurance company will probably deny your claim. Call us – we investigate and may be able to show that the cause of death was something else, or that the policyholder did not intend to harm themselves.

3. Misrepresentation on Application

Life insurance companies frequently rescind policies and deny claims for death benefits due to material misrepresentation on the part of the policyholder, for example, if the policyholder failed to disclose:

  • Past or present health conditions,
  • Past or present medications,
  • Past surgeries,
  • Participation in activities that the insurance company deems dangerous,
  • Financial background,
  • Criminal background,
  • Past or present lifestyle habits such as tobacco use, alcohol use, or drug use.

If you or someone you know is struggling with alcohol or drug abuse call the Substance Abuse and Mental Health Services Administration (SAMHSA) hotline at 1-800-662-HELP (4357) for free and confidential help, 24 hours a day.

If there is false information on your application for life insurance or medical questionnaire, the life insurance company will deny your beneficiaries’ claims despite you having paid premiums all those years. Call your life insurance company to correct any false information and update your information in order to get your beneficiaries paid.

If your life insurance claim was denied because the policy was rescinded due to misrepresentation, call us. We can help.

Agent Error or Omission

We have gotten many client beneficiaries paid when their claim was denied because the life insurance agent made a mistake completing the insured’s initial application for insurance. The life insurance company will deny beneficiaries’ claims due to alleged fraud, when the mistake was in fact the agent’s.

Knowingly Committing Fraud

In most states, a policyholder’s innocent mistake on a life insurance application does not rise to the level of fraud, and the life insurance company should pay beneficiaries’ claims. The life insurance company must show that the policyholder knowingly completed their application fraudulently with the intent to procure coverage or to pay less in premiums.

4. Employer Failed to Submit a Waiver of Premium

If an employee is disabled and out of work, and is covered by group life insurance through their employer, their employer must submit a disability waiver of premium to the life insurance company. If they do not, and the policy lapses due to nonpayment of premiums, the life insurance company will deny the disabled employee’s beneficiaries claims for the death benefit.

We get our client’s claims paid under these circumstances because the lapse was not the policyholder’s fault.

5. Problems with the Beneficiary

Insurance companies invariably deny or delay paying claims when there are one or more of the following problems with the beneficiary:

  • There is a life insurance beneficiary dispute.
  • There is no beneficiary designation on file and the life insurance payout must go through probate.
  • A life insurance beneficiary change was forged or fraudulent.
  • The beneficiary changed just before death.
  • The beneficiary was not updated after the primary life insurance beneficiary died.
  • The life insurance policy was a marital asset and the spouse was not named.
  • The beneficiary did not change after divorce in a revocation-upon-divorce state.
  • The policyholder’s spouse was not a beneficiary in a community-property state.
  • The beneficiary changed after divorce contrary to a family court order.
  • An irrevocable beneficiary changed.
  • Federal ERISA law governs group life insurance through the insured’s employer, overriding state law regarding beneficiaries
  • The beneficiary of the policy is a minor.
  • The beneficiary is not a specific person and vague, such as “children” or “relatives.”

6. Policy Was Included in a Will or Trust

If a life insurance policy was included in a will and the policyholder’s heirs are different from the life insurance beneficiary designation, this may spark a beneficiary dispute. The same may occur if the beneficiaries of a policyholder’s trust are different from their life insurance beneficiaries.

If the policy names a trust for a minor child or a special-needs child as beneficiary, the policy pays out to that trust.

7. Claim Denial Due to Suicide Exclusion

If a life insurance policy has a suicide exclusion, they will deny beneficiary’s claim for death benefits if the policyholder died from self-inflicted wounds. Suicide clauses differ depending on what state’s law applies to the policy but commonly provide that if the policyholder commits suicide within the first two years of this contract, the beneficiaries will receive a premium refund, but not the death benefit.

One common complication with enforcing suicide exclusions is proving that the policyholder actually committed suicide. It is not uncommon for an insured to die accidentally, resulting in what might look like a suicide.

One case in which we got our beneficiary client paid arose when the policyholder died due to auto-erotic asphyxiation. The autopsy stated that the cause of death was accidental, as the policyholder had laid out clothing for the next morning. The insurance company had the burden of proving that the policyholder “purposefully injured himself” (the wording of the exclusion) They could not as there was evidence the insured intended to survive, and we got our client paid.

Keep in mind that although we were successful in this case and many others, we cannot guarantee the result of any other matter. But we can guarantee that at the Boonswang Law Firm, our attorneys have extensive experience in taking on the challenge of disputing these suicide exclusions. As a result of our skill and knowledge in insurance law, we have been able to successfully obtain death benefits for clients who had previously been denied payment in the face of suicide exclusions.

If you or someone you know is struggling with thoughts of suicide, call the National Suicide Prevention Hotline at 1-800-273-8255 to access their national network of local crisis centers that provide free and confidential emotional support to people in suicidal crisis or emotional distress 24 hours a day, 7 days a week.

8. Policy Included a Drug or Alcohol Exclusion

Many policies have exclusions that will deny claims when the policyholder died due to illegal drug use or overdose on prescription drugs. Some policies also exclude and deny life insurance claims for death related to alcohol use.

Life insurance companies often apply these exclusions and deny claims when marijuana or some other drug was found in the toxicology report. Life insurance companies also will apply the exclusion in cases involving heroin overdoses, when someone took too many prescription pain pills or other medication, or died from alcohol poisoning.

Does life insurance cover drug overdoses? Does life insurance cover death from alcohol? Sometimes. Some states have laws that protect life insurance policyholders who are prescribed narcotics or who are deemed disabled due to addiction to drugs or alcohol.

One recent case in which we successfully got our client beneficiary paid arose when the insured died in a motorcycle accident. The toxicology report stated that the policyholder had “acute amphetamine intoxication” so our client’s death benefit claim was initially denied.  However, ultimately it was determined that the policyholder died of injuries sustained in the motorcycle accident some several weeks later, not from a drug overdose the day of the accident.

Of course, we cannot guarantee the result of any matter. However, our attorneys at The Boonswang Law Firm are extremely knowledgeable in life insurance laws across the country and the nuances one must argue when faced with claim denial due to policy exclusions. Our knowledge and experience help us zealously fight for our clients and get them the death benefits they deserve.

If you or someone you know is abusing drugs or suffers from drug addiction, call the Substance Abuse and Mental Health Services Administration (SAMHSA) hotline at 1-800-662-HELP (4357) for free and confidential help, 24 hours a day.

9. Policy Lists Other Exclusions

Every policy has a set of exclusions, and they differ from insurer to insurer. If there is any chance the policyholder’s death was excluded from coverage, the life insurance company will leap at the chance to deny their beneficiary’s claim.

This is especially the case in Accidental Death & Dismemberment life insurance policies and riders (AD&D), in which life insurance companies define “accidental” death in a manner that is deliberately hard to satisfy. Common provisions are that the insured must die within 90 days of the injury which caused his or her death and that death in an airplane is not covered for pilots.

Recently we settled a case where the insured died of drowning, but he drowned due to an undiagnosed heart condition. We argued that “accident” is an event that is not a natural and probable result of the insured’s own acts. In this case, there was no way the drowning could have been naturally and probably expected or anticipated by the insured because it was caused by his undiagnosed heart condition. Our client got paid.

Life insurance will often not pay out to beneficiaries’ and try to apply exclusions even when they are legally required to pay out. An insured should disclose participating in any activities that are considered dangerous by the insurance company. This might include skydiving, motorcycle riding, mountain climbing, kayaking, surfing, or anything that could be subject to exclusion under some policies. This way, an insured can get the type of policy that is right for them and their lifestyle.

10. Death Due to Act of War or Terrorism

Most policies have an Act of War exclusion allowing the life insurance company to deny claims connected to civilians killed in wars or acts of terrorism. This commonly applies to first aid and other medical volunteers in an area of conflict, journalists, and others who travel to regions of the world where there is armed conflict.

11. Death Resulted from Extreme or Dangerous Activities

“Accidental Death & Dismemberment” policies (AD&D) are commonly sold to policyholders under the impression that if they die of a non-natural, “accidental” cause, a death benefit will be paid to his or her beneficiaries. However, it is common for life insurance companies to deny accidental death claims.

Life insurance companies often define “accident” in an arbitrarily specific manner, in which long lists of provisions must be satisfied before they agree to pay out. Lie insurance companies then deny claims based on a failure to fulfill that list of provisions. Note that AD&D policies never cover self-inflicted death or health-related deaths, since both of these scenarios would not qualify as an “accident.”

We recently settled a matter for our client where the policyholder died from severe injuries he sustained in a motorcycle accident, several weeks after the accident. Our client’s claim was initially denied based on “acute amphetamine intoxication” and benzodiazepine use, although no medical history was available, no autopsy was ever performed, and the medical examiner never viewed the body.

We argued that the insured’s cause of death was the injuries sustained from the accident, having nothing to do with drug use, that foreseeability of the accident is legally irrelevant, and that even deaths resulting from negligence (taking drugs then driving) may still be an accident. We got our client paid!

12. Death Due to Homicide

In most cases, life insurance policies should pay out in the event of homicide. However, there are specific circumstances in which life insurance companies deny a beneficiary’s claim in the event of the policyholder’s murder.

If the beneficiary is under investigation for the homicide of the policyholder, then the beneficiary will not receive the death benefit until cleared of any involvement in the policyholder’s death. If the death is under investigation, the life insurance company delays paying claims until all beneficiaries are cleared of suspicion.

We had one case where the policyholder was murdered. The policyholder was a drug user, and the beneficiary’s claim was denied based on misrepresentation. We successfully argued that the agent did not probe into the policyholder’s drug use while completing the application, that the policyholder was never asked whether he was treated for drug abuse, and that drug abuse had nothing to do with his cause of death. Our client was paid in full.

13. Death while Living or Traveling Abroad

Does life insurance cover overseas death? Perhaps. A policy may specify that if the policyholder dies while living outside the United States, that is an exclusion that results in claim denial. Be sure to inspect your policy for this exclusion if you plan to travel or live abroad.

Be advised that if you die while traveling abroad, the insurance company may delay paying on your beneficiary’s claim while they investigate your death.

14. Policyholder Dies Committing an Illegal Act

This might seem like common sense, but there are plenty of times people do illegal things and don’t realize it. For example, what if you were jogging and unintentionally trespassed on private property? If you had a heart attack and died while jogging, the insurance company will try to deny your beneficiary’s claim because you were doing something illegal when you died.

15. No Insurable Interest

Someone purchasing life insurance covering someone else must have an insurable interest in the insured. If they do not, the life insurance company will deny their claim for death benefits.

16. New or Replacement Policy

If the policyholder replaced their former policy with a new one just prior to their death and failed to check for possible new exclusions, the life insurance company may deny their beneficiaries’ claims for a surprising reason. Similarly, when a policyholder purchases new or replacement life insurance, the contestability period restarts, and the life insurance company is empowered anew to deny claims for inconsistencies or inaccuracies in their application or medical questionnaire.

Talk with a Life Insurance Lawyer About Denied or Delayed Claims

The experienced life insurance lawyers at Boonswang Law have gotten beneficiaries across the nation paid when the life insurance company denied their claims due to these common reasons, among other reasons.

Don’t take no for an answer! If you believe your life insurance or AD&D claim has been unlawfully delayed or denied, don’t hesitate to contact us for your free case evaluation. We get our clients paid!

October 15, 2019

Does Life Insurance Cover Acts of War or Terrorism?

The answer is, maybe.

Most life insurance policies contain a “war exclusion” clause, which specifically excludes coverage for acts of war like:

  • Terrorism
  • Revolution
  • Military coup
  • Insurrection
  • Invasion

Have you lost a loved one due to a purported act of war or terrorism, and your life insurance claim was denied?  Don’t take no for an answer. Read on to find out why the war exclusion exists and what you can do when your claim is denied under that exclusion.

Why Can Acts of War be Excluded from Life Insurance Coverage?

Public policy dictates that since insurance companies could not remain solvent if they were obligated to pay for the massive destruction caused by acts of war, those acts can be excluded from life insurance coverage. If insurance companies were required to cover those losses, the payouts would be immense, causing life insurance premiums to rise exponentially and be unaffordable for most.

Originally war exclusion appeared only in the policies of those contractually assuming liability, rather than private people and organizations, under the now-outdated theory that only soldiers and military contractors could suffer a coverable injury through an act of war.

This changed during the fallout from the terrorist attacks on September 11, 2001, which resulted in many civilian deaths and injuries and many life insurance claims. Consequently, insurance companies added more detailed and far reaching “war and terrorism” clauses that also excluded coverage of civilians.

A Congressional Report from June 14, 2001 sets forth the history of and public policy underlying this evolution, yet concludes “that ‘war risk’ exclusion clauses will not likely be invoked against losses arising out of the events of September 11, in general, and the destruction of the World Trade Center, in particular.”

What is a War Act Exclusion?

Here is a sample War Exclusion provision from an actual life insurance policy:

WAR AND TERRORISM EXCLUSION ENDORSEMENT 

Notwithstanding any provision to the contrary within this insurance or any endorsement thereto it is agreed that this insurance excludes loss, damage, cost or expense of whatsoever nature directly or indirectly caused by, resulting from or in connection with any of the following regardless of any other cause or event contributing concurrently or in any other sequence to the loss; 

  1. war, invasion, acts of foreign enemies, hostilities or warlike operations (whether war be declared or not), civil war, rebellion, revolution, insurrection, civil commotion assuming the proportions of or amounting to an uprising, military or usurped power; or 
  2. any act of terrorism. 

For the purpose of this endorsement an act of terrorism means an act, including but not limited to the use of force or violence and/or the threat thereof, of any person or group(s) of persons, whether acting alone or on behalf of or in connection with any organisation(s) or government(s), committed for political, religious, ideological or similar purposes including the intention to influence any government and/or to put the public, or any section of the public, in fear. 

This endorsement also excludes loss, damage, cost or expense of whatsoever nature directly or indirectly caused by, resulting from or in connection with any action taken in controlling, preventing, suppressing or in any way relating to 1 and/or 2 above. 

If the Underwriters allege that by reason of this exclusion, any loss, damage, cost or expense is not covered by this insurance the burden of proving the contrary shall be upon the Assured. 

In the event any portion of this endorsement is found to be invalid or unenforceable, the remainder shall remain in full force and effect. 

Here is another sample:

You are not insured for: war, civil war, revolution, rebellion, insurrection, or civil strife arising therefrom or any hostile act by or against a belligerent power, capture, seizure, arrest, restraint or detainment (piracy excepted), and the consequences thereof or any attempt thereat, derelict mines, torpedoes, bombs or other derelict weapons of war.

What if I Need Insurance Coverage against War-Like Acts?

A company doing business in an environment where there is a risk of sustaining loss or death due to a war-like act can purchase War Risk Insurance. It is most commonly purchased by companies in the aviation and shipping industries.

War Risk Insurance has two components: War Risk Liability, which covers the people and items inside the airplane or ship, and; War Risk Hull, which covers the airplane or ship itself.

If your loved one worked in these industries or in related industries and died due to a war-like act or in a war zone, you should inquire whether he or she was covered under the employer’s War Risk Liability policy. Contact the Boonswang Law Firm at 1-855-865-4335 if you need help with this.

How Do I Know if War Exclusion Was Correctly Applied to Deny My Claim?

Herein lies the rub. Insurance companies do not want to pay your claim if your loved one died under circumstances where the war act exclusion provision may apply, so your claim will likely be denied outright and you will need to appeal that denial.

You will need to look at what the war exclusion clause expressly states. Take a look at the two very different war exclusion provisions above. The shorter of the two expressly excludes loss due to things like forgotten land mines or abandoned weapons or war.  The longer of the two does not.

So, if an insured steps on a WWII land mine and is killed… he is probably covered by the first policy and maybe not covered by the second.

There are always arguments to be made for coverage when war exclusion clauses are vague – and most are. A life insurance beneficiary attorney will look at the war act provision and ask, What are “acts of war” – must war be declared? Did the insured die from an act of war or from something else while located in a war zone? Did the insured die from a purported act of terrorism, but it occurred on domestic soil and was perpetrated by a U.S. citizen?  Did the insured die in a war zone, but from friendly fire? Did the insured died during training exercises, not while the enemy was engaged?

A War- or Terrorism-Related Death May Still Be Covered By Life Insurance

Not every any act that is war-related or terrorism-related is excluded from life insurance coverage. Today, violent conflict can be found all over the globe, from formally-declared war to insurrection and terrorist acts.  If your loved one died in or around any of that conflict, you and your attorney must explore the nuances of the applicable war exclusion provision against the facts and determine whether there are arguments for coverage. Chances are good that there are.

Contact national life insurance beneficiary attorney Chad G. Boonswang Esq. today to schedule your free consultation. Let us help you get paid!

August 7, 2019

Delayed Payout? Life Insurance Companies May Owe Interest

If a life insurance company is delaying payment of your claim, you may be owed interest. When an insurance company denies or delays your claim, they can continue investing the proceeds that would otherwise be in your pocket. The insurer may owe you the interest they accrued by holding onto your money. To find out if you are entitled to interest on your delayed payout, contact the life insurance attorneys with over 25 years of experience at the Boonswang Law Firm.

We will describe some real-life situations our clients have faced and how we got them paid.  While these are all true case studies, keep in mind that we cannot guarantee that the result of your matter will be the same.

What is the typical timeline for insurance companies to investigate claims?

After the insured has died, beneficiaries to the life insurance policy must file a claim with the insurance company. Claimants will be required to include a copy of the death certificate with their claim. It is important that you keep at least one original death certificate in your possession in the event that the life insurance company misplaces the one you sent them. When the insurance company receives the claim form and a certified copy of the death certificate, insurers have 30 days to deny the claim, pay the claim, or ask for more information.

In some situations, insurers will need to investigate a claim, and the time of payment of claims will exceed 30 days. Depending on the terms of the insurance policy and the laws that govern the policy, sometimes a beneficiary will be entitled to interest that has accrued during the delay of payment. Contact a life insurance lawyer at Boonswang Law to learn what the timeline is in your jurisdiction, as they differ depending upon where you live.

Delay in payout instead of denying or approving

In most cases, an insurer will either deny a claim or pay a claim. Occasionally, an insurer will require a longer period to investigate a claim. Delays may occur in the following situations:

  • The insured died by homicide. When an insured is murdered, the insurance company often waits to pay any benefits until the investigation is completed. Depending on the type of policy in question (whole life or accidental death), the insurance company may need to know whether the beneficiary is associated with the murder or whether the insured was engaged in a felony at the time of his or her death. 
  • The insured died in a foreign country. If the insured dies while abroad, an insurance company may take longer to investigate. Insurers always require proof of death when a claim is made. In the U.S., a death certificate is an acceptable proof of death. However, customary practices, records, and technologies vary across countries and continents. To ensure a claim for overseas death is not fraudulent, an insurance company may attempt to independently confirm the circumstances of the insured’s death. Depending on where the insured died, this may extend the investigation period significantly.
  • A beneficiary dispute occurs. If the insurance company is notified that multiple parties might have a claim to life insurance proceeds, it will postpone paying the benefit until a rightful beneficiary is established. Often, the insurance company will not make this determination itself. The insurer may file an interpleader action, and a court will decide the lawful beneficiary. In one case we had, the insurance company delayed paying for over two years because the insured had a girlfriend and child, neither named in his policy. Luckily for our client, Illinois law prevents such improper claim practices and unreasonable or vexatious delay in paying claims, and we were able to get our client paid.
  • The insured died within the contestability period. The contestability period lasts for two years. During this time, an insurer is allowed to investigate the original application to look for evidence of fraud. If the insured dies within this two-year period, a payout of benefits may be delayed while the insurer examines medical records, financial records, or other relevant evidence.
  • The insurance company made an administrative error.  In one case, our client’s claim was delayed because the insurance company never received medical records from a doctor that the insured neer visited.  If your claim is denied, please get all the details you can about the reason for the denial – it may be something this simple.
  • The insured never received notice of lapse or termination, and the policy lapsed and/or terminated. In this case, our client’s claim was denied because the insured never received the statutorily-required notices. We got our client paid.

How can a beneficiary get interest?

If an insurance company delays their response to your beneficiary claim, you may be entitled to interest. Interest varies depending on jurisdiction and policy terms. The policy may state that a beneficiary is entitled to interest after a specified delay. Some states also have statutes that grant interest when an insurer unreasonably delays a claim determination. For example, this Iowa statute explains the circumstances that allow a beneficiary to collect interest, and the rate at which the interest is calculated.

Some circumstances of delay are inherently unreasonable, including:

  • A delay in payment after the claim has been approved. Occasionally, an insurer or a company’s agent will tell a beneficiary that a claim has been approved, but the insurer will be slow to send payment. The longer an insurer retains the funds, the longer an insurer is able to continue investing those proceeds and reaping the profits.
  • An insurer has reason to know that an insured died, but does not reach out to the beneficiary. Sometimes, a beneficiary is unaware that he or she is named in a policy, or that a policy even exists. If an insurer has reason to know that an insured has died, for example, because they use the Social Security Death Master File to identify policyholders who have died, that insurer should notify the beneficiary. Recently, several states have brought lawsuits against insurance companies that knew of policyholder deaths but failed to notify beneficiaries, and instead retained the benefits. If a beneficiary does not find out that he or she is entitled to benefits soon after the insured dies, the beneficiary may be entitled to interest due to the delay.

What can a lawyer do if the insurance company delays instead of denying or approving a claim?

An experienced life insurance lawyer will be able to tell you whether the delay can be turned into approval and whether you are entitled to interest for the time of the delay.  Frankly, an insurance company has no incentive to tell you that you are entitled to interest.

A life insurance attorney can demand and obtain the full benefits you are legally entitled to. Again, your right to interest depends on the jurisdiction in which the policy was issued and the terms of the policy itself. For more information about your rights to interest on a delayed payout of benefits, contact a trusted life insurance attorney at the Boonswang Law Firm with your questions.

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