What to Do if the Insurance Company Denies a Life Insurance Claim
If you are the beneficiary of a life insurance claim, someone who cared for you hoped to provide financial support after they had died. In many cases, this support is a crucial financial lifeline. If a life insurance claim has been denied, it could be everything from a mere frustrating event to economic hardship. Below, our experienced Philadelphia life insurance claim denial attorney from the Reiff Law Firm discusses what options are available to you if your life insurance claim is denied.
Common Reasons Why Life Insurance Claims are Denied in Pennsylvania
There are some typical reasons why an insurance company will deny a life insurance claim. Some of these are justified and leave the claimant little recourse. However, in many situations, an insurance company’s denial could and should be challenged.
Missed Premium Payments
When an insured fails to pay their required premiums, their policy becomes delinquent. If this occurs, the policy could lapse, rendering it ineffective. One of the main reasons an insurance company will deny a claim is because the policy is no longer in force due to a lapse. In some cases, an insured will purposefully allow their policy to lapse without informing their beneficiaries. However, in other situations, payments might have been misapplied or there could be an accounting mistake.
If an insured failed to disclose a heart condition or that they were a regular smoker on their initial life insurance application, a claim could be denied due to a material misrepresentation. Other misinformation could include erroneously stating an insured’s age or weight. What constitutes a material misrepresentation could be challenged if a claim is denied. For instance, a mistake of five or ten pounds would not necessarily be considered a material falsehood. However, if a 50-year-old individual claims that they are 35 on their application, it could be difficult to appeal a denial.
There are two types of contestable circumstances insurance companies will use to deny a life insurance claim. When an insurance policy is purchased, there is a contestability period that could range from one to three years. During this period, a claim could be denied under specific circumstances outlined in the policy. Typically, a contestable death will relate specifically to a medical condition the insured might have, such as a heart condition or cancer.
In other situations, a death is contestable because it falls outside the scope of coverage. A common exclusion on nearly every life insurance policy is suicide. While policy exclusions are continuing to decline in contemporary insurance policies, many older ones still include several exclusions. These exclusions often include certain high-risk behaviors, such as mountain climbing or skydiving.
A number of administrative issues could result in a claim being denied, for example, if a policyholder failed to name a beneficiary on their policy paperwork. Under these circumstances, the policy would be paid to the estate, which would have to be probated. This process could take years and the benefits would not necessarily be paid to those individuals who believed they were beneficiaries.
In other cases, a beneficiary fails to provide the necessary paperwork or documentation required to receive the claim benefits. In this case, an experienced Pennsylvania life insurance claim denial attorney could provide invaluable assistance.
Steps to Take if Your Life Insurance Claim is Denied in Pennsylvania
If your anticipated life insurance claim was denied, there are some steps you should take to appeal the decision. There are some situations where the dishonesty or conduct of the policyholder will render a policy void. However, that does not mean that every denial is justified or that a claim was not mishandled.
If you disagree with a denial or an insurance company disqualifies an appeal, you could challenge the insurance provider’s decision with the help of a knowledgeable Pennsylvania life insurance attorney.
If your claim was denied, the insurer will send you a denial letter setting forth the reasons for its decision. However, if the denial letter lacks sufficient details or documentation, the first step is to contact the insurance company for more information regarding its objections to the payment of benefits under the policy terms.
An insurance company will have a procedure in place to appeal their decision. While it is not required to have legal representation during this process, it is complicated and you are grieving. Having an experienced attorney gather the required documentation and evidence to prepare an appeal will increase the likelihood of success.
Suing an Insurance Company for Denying a Life Insurance Claim in Pennsylvania
Insurance policies are contracts. Every contract holds the parties involved to certain obligations. This includes both the policyholder and the insurer. Under Pennsylvania law, an insurance company must adhere to the contract’s terms in good faith while avoiding unfair trade practices. For example, an insurance company should not delay or perform an inadequate investigation into a claim. If there are no material problems, then an insurer should pay the claim according to the policy’s provisions. Furthermore, if a claim is denied, an insurance company should provide a reasonable explanation and specific reasons for its decisions. When a claim is denied because of the misinformation supplied on the original application, there should be evidence to support that the misinformation was material and not just a small mistake or misunderstanding.
If your insurance claim was denied and you believe that the insurer did so improperly, contact our Pennsylvania life insurance claim denial attorney. Our office will evaluate the facts of your case and thoroughly review all relative documentation. If the insurance company acted unfairly, our office will work with you to either appeal the decision or, if necessary, file a lawsuit against the insurance company.
Call Our Pennsylvania Attorney if Your Life Insurance Claim Was Denied
The death of a loved one or family member is never emotionally easy. Your situation should not be further complicated by dealing with an insurance company denying or delaying life insurance benefits. Contact our Philadelphia life insurance attorney to discuss your options and legal rights. Call the Reiff Law Firm at (215) 709-6940 to schedule a free consultation.