Life insurance is often seen as essential in good financial planning that provides loved ones with much-needed security in the event of a death. But what happens when this life insurance claim gets denied, not because of the policyholder's oversight, but due to misunderstandings or misinterpretations of the policy terms? Unfortunately, this scenario is all too common, leaving grieving families grappling with denied claims and financial instability. The situation could happen with any life insurance company such as: Prudential Life; MetLife; Globe Life; Corebridge Life; etc.
One of the primary reasons for claim denials is the complexity of insurance policies themselves. Life insurance contracts are often dense with technical jargon, making them difficult for even the most sophisticated person to fully understand. Clauses that seem straightforward at first glance can harbor nuances that lead to different interpretations. For example, terms like "pre-existing condition" or "material misrepresentation" may appear clear but can be interpreted in ways that disadvantage the policyholder. Consider a scenario where a policyholder passes away, and the insurer denies the claim based on a supposed non-disclosure of a pre-existing condition. The policyholder might have genuinely believed the condition wasn’t significant enough to disclose or wasn’t aware it fell under the insurer's definition. These gray areas become battlegrounds for disputes, and the life insurance lawyers from LifeInsuranceAttorney.com love to fight these denied life insurance claim cases. Most life insurance policies have a contestability period, typically lasting two years, during which the insurer can review the application for inaccuracies or omissions. While this clause is designed to prevent fraud, it has sometimes been misused to deny legitimate claims. For instance, a minor or unrelated inaccuracy in the application, such as misstating one’s weight or forgetting a brief doctor’s visit or ER visit, can become grounds for denial if the insurer deems it "material" to the risk assessment. The interpretation of "material misrepresentation" is a contentious issue. Insurers might argue that even small discrepancies would have impacted their decision to issue the policy, while beneficiaries contend that such errors were inadvertent and irrelevant to the claim.
Many policies include a suicide exclusion clause, which typically states that no benefits will be paid if the policyholder dies by suicide within a specified time, often two years, after the policy's inception. While this is a standard provision, it has been at the heart of numerous disputes. The challenge lies in determining the cause of death, particularly when circumstances are ambiguous. For instance, an accidental overdose might be classified as suicide by the insurer, leaving the family to contest the claim and prove otherwise.
Life Insurance Lawyers from LifeInsuranceAttorney.com
Our life insurance law firm is here to help fight your delayed or denied claim. We handle many disputes among beneficiaries and interpleader lawsuits as well.