Does Life Insurance Cover Deaths From COVID-19? What Beneficiaries Need to Know
Yes, most life insurance policies will pay death benefits for individuals who pass away due to COVID-19. However, there are specific circumstances—such as policy misrepresentations, lapsed coverage, or contestability period reviews—where claims may be delayed or denied. Understanding your policy's fine print and legal rights is crucial to avoiding an unexpected denial.
Are Life Insurance Companies Denying COVID-19 Claims?
The majority of life insurance carriers have stated that COVID-related deaths are covered under existing policies. This is reassuring news for policyholders and their families. However, as with any claim, insurers may still look for reasons to deny payment—particularly if the death occurred during the contestability period or if the policyholder’s application contained any omissions or errors.
Most denials we've seen related to COVID-19 fall into several predictable categories, often tied to technicalities in the policy language, incomplete documentation, or disputes over whether the policyholder provided accurate information at the time of application.
Common Reasons for COVID-19 Life Insurance Claim Denials
Despite the general presumption of coverage, insurers still reject claims for a variety of reasons. Some of the most common include:
1. The Policyholder Only Had Accidental Death Coverage
One of the most common reasons a COVID-19 death claim is denied is that the deceased only had an Accidental Death and Dismemberment (AD&D) policy. These policies strictly cover deaths caused by accidents—not illnesses. Since COVID-19 is a viral illness, it is not covered under AD&D policies. If the individual did not also hold a traditional life insurance policy, the claim will likely be denied.
2. Misrepresentations or Omissions on the Application
Life insurance contracts are based on the accuracy of the application. If a policyholder failed to disclose a prior COVID-19 diagnosis, lied about smoking status, or omitted key medical history, the insurer might argue that the policy was obtained fraudulently. This is especially likely if the death occurred within the first two years of the policy—known as the contestability period—when insurers are allowed to conduct a thorough review of the application.
3. Policy Lapse Due to Nonpayment
Another common issue is policy lapse due to missed premium payments. If the policyholder was hospitalized with COVID-19 and unable to manage their financial affairs, they may have missed a payment, leading to a lapse. Insurers are required to provide grace periods—typically 30 days—and send notices of nonpayment, but if the policy isn’t reinstated before death, the insurer may deny the claim.
Some states have implemented temporary mandates during the pandemic, requiring insurers to extend grace periods. However, these rules vary by state and may not apply retroactively.
4. Application Inaccuracies or Honest Mistakes
Even small errors on the application—such as an incorrect birthdate, failure to list all medications, or missing details about travel or hobbies—can give insurers grounds to investigate or delay a claim. If the insurer determines that any of these omissions were material to the risk being insured, they may attempt to void the policy.
5. Smoking or High-Risk Health Conditions Undisclosed
Smoking is a major red flag for insurers, especially during the COVID-19 pandemic, as it increases the likelihood of complications. If the policyholder failed to disclose smoking or other high-risk behaviors, the insurer may argue that the policy was issued under false pretenses—even if the cause of death was strictly COVID-related.
Good Faith Obligations of Insurers During the Pandemic
Even with exclusions and conditions, life insurance companies are legally obligated to act in good faith. This means they must:
Investigate claims fairly and promptly
Respond to claim submissions within a reasonable time
Avoid unjustified delays or excuses for denial
Communicate clearly about what is needed to process the claim
If an insurer deliberately stalls a claim, fails to provide explanations, or misrepresents policy terms, it may be engaging in bad faith conduct. This is not only unethical—it’s also actionable. Courts can award punitive damages and attorney’s fees in bad faith cases, which can exceed the original policy amount.
Examples of Bad Faith Claim Practices
Purposefully delaying a payout to run out the statute of limitations
Reclassifying a COVID-19 death as “accidental” or “ineligible” to deny coverage
Claiming misrepresentation for minor, non-material omissions
Ignoring or not responding to documentation from the beneficiary
These tactics are unfortunately common. Insurers rely on grieving families being too overwhelmed to fight back. That’s why having an attorney experienced in life insurance denials is critical.
Understanding the Contestability Period and COVID-19 Deaths
All life insurance policies include a contestability clause, usually lasting for the first two years after the policy takes effect. During this time, the insurer can review the original application if the insured dies and determine whether any misrepresentations were made.
While a COVID-related death itself is not a cause for denial, the timing may trigger a deeper investigation into the insured’s medical history, travel habits, or lifestyle choices. If the insurer finds inconsistencies—such as unreported medical treatments or risk factors—it may try to rescind the policy altogether.
It’s important to remember that even during the contestability period, not all mistakes warrant a denial. Honest errors—like listing the wrong pharmacy or forgetting to mention a short-lived prescription—should not be considered material. However, insurers often exploit these technicalities to avoid paying out claims.
How a Life Insurance Attorney Can Help with a COVID-Related Denial
If you've received a claim denial after the death of a loved one due to COVID-19, don’t assume the insurer’s decision is final. A qualified life insurance attorney can:
Review the policy for coverage terms and exclusions
Examine the application and determine whether any mistakes were actually material
File an appeal with compelling legal arguments and documentation
Negotiate with the insurer for a reversal or settlement
File a lawsuit if the insurer continues to deny a valid claim
Legal representation is especially important when the claim is tied to the contestability period or alleged misrepresentations. These are complex, fact-sensitive issues that often require an aggressive legal approach.
If Your Life Insurance Claim Was Denied After a COVID-19 Death, Call Us Today
Losing a loved one is devastating, and being denied life insurance benefits only adds to the emotional and financial burden. If your claim was rejected—whether due to contestability, nonpayment, or alleged inaccuracies on the application—you may still have options. We have successfully handled numerous cases involving denied COVID-19 claims and can help you fight back.
Contact our experienced life insurance attorneys today for a free consultation. We’ll review the denial, analyze the policy, and help you understand the next steps in recovering the benefits your family deserves.