What Is a Material Misrepresentation in Life Insurance?
A life insurance policy is a legal contract. When someone applies for coverage, they are required to answer a series of health and lifestyle questions truthfully. These responses form the basis of the insurance company's risk assessment. If a policyholder lies, omits key information, or misstates facts, and the insurer later claims it wouldn’t have issued the policy (or would have done so under different terms) had it known the truth, the misstatement is considered material. Material misrepresentations can void the policy entirely—especially if the policyholder dies within the contestability period, usually the first two years after issuance.
But the law also acknowledges that humans are imperfect. Not every error is grounds for a denial. The key question is whether the misrepresentation was made with intent to deceive or whether it substantially influenced the insurer’s decision to issue coverage. Courts have ruled against insurance companies in cases where the alleged misstatement was minor, unintentional, or something the insurer could have—and should have—verified independently.
Case Study: A Denied Claim Based on High Blood Pressure History
To illustrate how murky these cases can be, let’s look at the story of Paul, who applied for a life insurance policy and died unexpectedly within the first year. During the application process, Paul was asked whether he had any “current” medical conditions and whether he had high blood pressure. He answered “no” to both. He was also asked to list any prescription medications he was taking, but he left that section blank, forgetting the name of a drug he had recently been prescribed.
Paul’s broker reviewed the application in his presence but didn’t ask him to clarify the blank response. Nor did the insurance company follow up before issuing the policy. Paul paid his premium and the policy became active. Less than a year later, Paul died of a heart attack. His wife Sue, listed as the sole beneficiary, submitted a claim. Because the policy was still within the contestability period, the insurer began a full investigation. Upon reviewing Paul’s medical records, the company discovered that Paul had been diagnosed with high blood pressure and had been prescribed medication. They used this as the basis to deny Sue’s claim, asserting that Paul made material misrepresentations on the application.
Was It Really a Lie?
Initially, Sue was devastated but unsure if she had any grounds to challenge the denial. She contacted a life insurance attorney, who began by analyzing the application itself. What stood out was not that Paul had deliberately lied, but that the application’s language was ambiguous—and that the insurer had failed to follow up on the incomplete answer about prescription medication. The lawyer argued that the insurer and broker had a duty to clarify the blank field before issuing the policy. Had they done so, they could have learned about Paul’s condition and made a fully informed decision. The failure to do so, the attorney argued, undercut the insurer’s claim that Paul had intentionally misrepresented material facts.
The case went to arbitration. While the insurer did not fully reverse its decision, it agreed to pay 50% of the policy benefit to Sue. It wasn’t the full amount, but it was a recognition that the issue was far from clear-cut—and a validation that the denial was not as ironclad as the insurer had claimed.
Key Takeaways from Paul’s Case
Paul’s story highlights several important truths about life insurance denials:
Not all mistakes are material. The law distinguishes between intentional deception and honest misunderstanding.
Insurers must do their due diligence. If they overlook gaps in an application or fail to ask follow-up questions, that may weaken their ability to deny a claim later.
Beneficiaries should never accept a denial without review. Even a seemingly straightforward denial may be vulnerable to legal challenge.
What to Do If Your Claim Was Denied Due to Misrepresentation
If your loved one’s life insurance claim was denied based on alleged material misrepresentations, don’t assume the denial is final. Start by requesting a copy of the application, the insurer’s investigative report, and the official denial letter. Then contact an attorney who focuses exclusively on life insurance disputes. These claims involve contract law, medical records, and insurance regulation—areas that general practitioners may not fully understand.
At our firm, we handle life insurance claim denials every day. We’ve helped clients recover full or partial benefits even after strong denial letters were issued. Sometimes we succeed by identifying policy language the insurer misinterpreted. Other times, we demonstrate that the insurer should have known the facts before approving coverage and failed to act accordingly. And in many cases, we find the insurer simply overreached—denying a claim on technical grounds with little legal support.
Don’t Let an Insurance Company Intimidate You
The term “material misrepresentation” is powerful. Insurance companies know it sounds final and threatening. But with the right legal strategy, many of these denials can be contested and overturned. If something about your denial doesn’t sit right, trust your instincts—and reach out for legal advice. You may still be entitled to the benefits your loved one intended for you.