Failure to Pay Life Insurance Claim Lawsuit Attorney

What are the Laws that Govern Life Insurance Policies?

Life insurance policies are governed by state or federal laws. If the policy was purchased privately, disputes are usually settled via state laws. But life insurance policies that are provided through the employer are usually under federal regulations, specifically, the Employee Retirement Income Security Act (ERISA).

Keep in mind that federal and state regulations have significant differences, so you must ensure that you are applying the correct laws when you have disputes over a life insurance claim. Whether you need an experienced ERISA life insurance lawyer or someone that’s knowledgeable in California state laws for life insurance, we have the legal expert you need here at DTLA Law Group.

Why was my Life Insurance Claim Denied?

As a life insurance policy beneficiary, there are many reasons why the company may have rejected your claim. Though we can’t cover them all in this article, let’s go over the most common issues that can cause a life insurance claim to be denied.

Lack of Documentation – Insurance companies may argue that you have not provided the required documents needed to process a claim. This is a legitimate reason in most cases, but an insurance provider may also use it as an excuse to delay payment or make the beneficiary give up out of frustration.

Material Misrepresentation – Here, the insurance company is saying that the deceased lied about or intentionally withheld information about their insurability. A common example is withholding a diagnosis for a serious illness, which they knew about prior to signing up for the policy. But insurance companies can also mislead claimants by honing in on a minor mistake, like the date when the insured was examined by their doctor. On its own, this is not enough to deny a life insurance claim that’s filed by the beneficiary.

Evidence of Insurability – Some insurance companies require evidence that the insurer is of good health to be eligible for coverage, which is known as evidence of insurability (EOL). We have seen many cases where an insurer starts collecting premiums, even though the EOL is not on file. Though the insurance company is at fault here, it’s not unheard for these companies to use this as an excuse to avoid paying out a claim once the insured is deceased.

Incontestability – when someone applies for life insurance, the company has a period of contestability to investigate and dispute the information that’s on the application. Information that is not disputed within this time cannot be used later on to deny payment to a beneficiary.

Failure to Pay Premiums – Also known as a lapse in coverage, a policy holder’s failure to pay insurance premiums is the most common reason to deny a claim. However, there are strict rules on the notice that must be given to the insured regarding missed payments. If proper notice was not given, an insurance company’s right to deny payment would be invalidated, meaning that the beneficiary must be paid what they are owed according to the policy terms.

Additional Complications for Life Insurance Purchased through Work

Group insurance policy claims through an employer have added requirements that can cause problems when it comes to a benefits claim upon the employee’s death. Claims can be denied for many reasons, including:

• The policy holder was not working for the employer full time
• The employee was out on sick leave at the time of death
• The employee had not worked for the company long enough
• The employer failed to deduct the right premium amount
• When the employee moved on to another job, the policy was not ported correctly to the new employer’s group plan.

These reasons may be valid depending on the policy terms, but you should always investigate whether or not a claim denial can be disputed. Some of these errors are not the employee’s fault, and there was no way they could have known about the issues unless they were informed by the insurance company or their claims administrator. Our lawyers for denied life insurance claims can look into the matter and ensure that you are not taken advantage of.

Contact Our Law Firm

If you were unjustly denied payment from a life insurance policy, our attorneys are here to guide you through the legal process step by step. Our legal team has decades of experience in life insurance claim denials, including cases involving bad faith by an insurance company.

We provide all clients with a Zero Fee Guarantee, meaning you pay $0 out of pocket if you decide to hire us. Legal fees are recovered at the end of your case and only if we bring you compensation from a successful lawsuit. If not, you owe us absolutely nothing, as we don’t get paid unless you do.

To schedule a free consultation on your rights and legal options, contact us today.