Life Insurance Lawsuits in Court: Real Cases Challenging Denied Claims
When life insurance companies deny valid claims, beneficiaries are often left feeling powerless in the face of confusing policy language and vague exclusion clauses. But courts across the country continue to see lawsuits where individuals fight back against these wrongful denials—and win. Our life insurance law firm closely follows litigation trends and actively handles similar disputes nationwide. Below are real-life cases from federal and state courts where beneficiaries challenged insurance giants like Lincoln National, MetLife, Prudential, and others over denied life insurance claims. These lawsuits show how legal action can turn the tide against unfair insurer practices.
Lincoln National Life Insurance: Class Action Over Intoxication Exclusion
In October 2022, a beneficiary filed a class action lawsuit in Illinois federal court against Lincoln National Life Insurance Company, alleging that its denial of accidental death and dismemberment (AD&D) benefits violated California insurance law. The claim arose after the plaintiff’s daughter died from falling out of a window, and the insurer denied the payout based on an intoxication exclusion. The lawsuit argues that California does not permit such broad exclusions under AD&D policies and that Lincoln National unlawfully used the clause to avoid paying legitimate claims.
Metropolitan Life Insurance: Pre-Existing Condition Dispute in California
In June 2021, a California federal court heard a case against Metropolitan Life Insurance Company brought by a beneficiary whose husband died of colon cancer. MetLife denied the claim under a pre-existing condition exclusion, claiming the deceased had been treated for cancer within two years before applying for coverage. The plaintiff argued that MetLife wrongfully applied the exclusion and failed to clearly define or explain it. This case highlights how vague pre-existing condition clauses are often used to deny claims without concrete proof.
Prudential Life Insurance: Misrepresentation and ERISA Violation Allegations
Filed in March 2021 in New Jersey federal court, this lawsuit against Prudential Insurance Company of America involves a life insurance claim denied due to an alleged misrepresentation on the application. The plaintiff’s wife died of breast cancer, and Prudential argued she had failed to disclose her diagnosis. The beneficiary sued under ERISA, claiming the insurer breached its fiduciary duty and misapplied the contestability period. This case underscores how ERISA plans must meet higher standards for fairness and transparency.
American General Life Insurance: Smoking History and Contestability Period
In February 2021, a Texas state court heard a dispute involving American General Life Insurance Company and the estate of an insured who died of lung cancer. The insurer denied the claim, citing misrepresentation of smoking habits within the contestability window. The estate alleged that the denial was made in bad faith and violated the Texas Insurance Code. This case highlights how insurers often focus on smoking-related omissions—whether relevant to the cause of death or not—to invoke denial under contestability clauses.
Transamerica Life Insurance: Policy Type Dispute in Georgia
In January 2021, a Georgia federal court reviewed a case against Transamerica Life Insurance Company, in which a beneficiary’s claim was denied after the insured died of pancreatic cancer. Transamerica argued the policy only covered accidental death, not sickness. The plaintiff alleged breach of contract and violation of state law, arguing that the policy was misleading and that the insured believed it provided traditional life insurance coverage. This case reveals the critical importance of knowing whether a policy includes only accidental death coverage.
United of Omaha Life Insurance: Suicide Exclusion Misapplied
A December 2020 lawsuit in Florida federal court challenged United of Omaha Life Insurance Company after it denied a life insurance claim based on an exclusion for suicide or self-inflicted injury. The plaintiff’s mother died of ovarian cancer, but the insurer claimed she had intentionally overdosed on medication. The beneficiary argued that the death was due to terminal illness, not suicide, and that the denial was speculative. The case raised important questions about proof standards and insurer obligations to conduct a full investigation before issuing denials.
Minnesota Life Insurance: Drug/Alcohol Abuse Exclusion in Cancer Death
In November 2020, a beneficiary sued Minnesota Life Insurance Company in Alabama federal court after her husband died of liver cancer. The insurer denied the claim under an exclusion for death resulting from drug or alcohol abuse, asserting a history of alcoholism. The plaintiff challenged this defense, stating the death was due to cancer, not substance use. Courts often require a direct link between the cause of death and the excluded behavior—something insurers frequently overreach in proving.
Globe Life and Accident Insurance: Disease Contraction Clause Disputed
In October 2020, a beneficiary filed suit in Oklahoma federal court against Globe Life and Accident Insurance Company over a denial related to an illness exclusion. The insurer claimed the insured contracted cervical cancer within two years of the policy date and denied the claim under a clause excluding illnesses developed during that period. The plaintiff contested the timing and applicability of the clause, alleging breach of contract and violation of Oklahoma insurance law.
What These Cases Tell Us
Across the country, beneficiaries are taking insurers to court—and winning—when companies like Lincoln, MetLife, and Transamerica use overly broad exclusions or improperly applied contestability clauses to avoid paying life insurance benefits. The most common defenses challenged include:
Intoxication or drug/alcohol exclusions in AD&D and standard policies
Pre-existing condition clauses and vague eligibility restrictions
Misrepresentation or fraud allegations within contestability periods
Suicide and self-inflicted injury exclusions, even when the death was due to illness
Policy type disputes, especially around accidental-only coverage versus full life policies
If your claim was denied under any of these circumstances, our attorneys can review your case and fight to recover the benefits owed.
FAQ
Can a life insurance claim be denied for intoxication?
Only if the policy clearly and legally allows it. Some states, like California, restrict the use of intoxication exclusions—especially in AD&D policies. These clauses are frequently challenged in court.
What if the insured died of a disease they didn't know they had when applying?
Insurers must prove that the insured intentionally withheld medical information. Many claims are wrongly denied under pre-existing condition clauses when the insured was unaware of the illness.
How does ERISA affect life insurance disputes?
If the policy is employer-sponsored, it likely falls under ERISA. This federal law imposes fiduciary duties on insurers and provides legal remedies for wrongful denials.
Can beneficiaries sue for bad faith if a claim is denied?
Yes. If the insurer knowingly misapplied policy terms, failed to investigate, or used unfair tactics to avoid paying, they may be liable for bad faith damages under state law.