Cause of Death Usually Does Not Impact Life Insurance Payment

UNLESS A SUICIDE WAS INVOLVED AND OCCURRED WITHIN CONTESTABILITY PERIOD Many people mistakenly assume that the cause of death might impact whether the life insurance company pays the claim for life insurance. Under most circumstances, however, the cause of death would only directly impact the life insurance company’s decision to pay the benefit owed (1) if the deceased committed suicide and (2) if the death occurred within the “look back” period, referred to as the contestability period. This rule would not apply to an accidental death policy. The contestability period, which is two years in most states (including New Jersey, New York, and Massachusetts), allows the life insurance company to review the initial application to ensure that the policy holder accurately provided all the relevant information and did not leave out any details that would have affected the type of policy issued and/or the amount of the premium charged. Additionally, if a suicide occurs within that period, the life insurance company can deny the claim for benefits, on the theory that the policy holder may have been intending to commit suicide when the policy was purchased, and that the insurance company would not have issued the policy if that information had been known in advance. Within the contestability period, other than a suicide, the insurance company would not be directly concerned with the cause of death. For example, if the insured had a heart attack, that fact in itself would not impact whether the life insurance company pays the benefit owed. However, for any death occurring within the contestability period, the life insurance company is entitled to review the policy application and request the deceased’s medical records, to confirm that all key information had been included in the application. So, for the example of a person whose death was due to a heart attack, the life insurance company would review the application to see if any prior history of heart disease had been disclosed. If a prior history of heart disease had been listed on the life insurance application, the insurance company cannot claim that it did not have all the information necessary to properly analyze the risk of issuing the policy and to figure out the proper premium to charge. It therefore cannot point to the cause of death as a reason to deny payment of the benefits owed under policy (assuming the premiums had been paid on time). Additionally, if the medical history shows that the policy holder had no history of heart disease at the time of the application (meaning that the condition developed later on), the life insurance would not be able to deny the claim based on the cause of death. On the other hand, if the life insurance company finds that some other medical condition was not disclosed on the application, it could deny the claim, even if that other condition was completely unrelated to the cause of death. Similarly, if false financial information or other false statements were made on the policy application, the life insurance could deny the claim. Beyond the contestability period, the cause of death is generally not relevant to the life insurance company’s determination of whether to pay the benefit. Other grounds for denial are still possible, however, such as failure to pay the premiums. In summary:

1. Within the contestability period:
   1. Suicide can be basis for the life insurance company’s denial; and
   2. Other causes of death would not directly be basis for life insurance company’s denial, but could provide the life insurance company to review the application to ensure that any medical information related to the cause of death had been disclosed (if known at the time of the application).

2. Beyond the contestability period: cause of death is not relevant

If you recently lost a loved one who had life insurance for which payment was denied or which you fear may be denied, the life insurance attorneys at Trief & Olk are available to answer your questions and represent you if life insurance has been denied. Feel free to consult our website for examples of the many successes we have had when life insurance companies denied payment or call us directly to discuss how we may help you.   { “@context”: “https://schema.org”, “@type”: “BlogPosting”, “headline”: “Illegal Beneficiary Change: What Does it Mean for You?”, “description”: “Learn about illegal beneficiary changes in life insurance policies, including forgery, undue influence, and lack of capacity. 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This includes forged signatures on change-of-beneficiary forms, changes made under undue influence or coercion, changes made when the policyholder lacks legal capacity due to dementia or cognitive impairment, or changes that fail to follow required state procedures such as proper witnessing or notarization. Each state has specific laws governing valid beneficiary changes.” } }, { “@type”: “Question”, “name”: “How can I prove a beneficiary change was made under undue influence?”, “acceptedAnswer”: { “@type”: “Answer”, “text”: “Proving undue influence requires demonstrating that someone exerted excessive pressure or manipulation on a vulnerable policyholder. Evidence may include the policyholder’s medical records showing cognitive decline, testimony from caregivers or family members about isolation or coercion, documentation of the influencer’s control over the policyholder’s finances or daily life, suspicious timing of the change relative to illness or dependency, and expert testimony from medical or mental health professionals. Experienced attorneys work with forensic experts to build compelling cases.” } }, { “@type”: “Question”, “name”: “What is legal capacity and how does it affect beneficiary changes?”, “acceptedAnswer”: { “@type”: “Answer”, “text”: “Legal capacity means the policyholder must understand the nature and consequences of changing a beneficiary designation. Lack of capacity can result from dementia, Alzheimer’s disease, mental disabilities, severe cognitive impairment, or being under the influence of drugs or alcohol. If a change was made when the policyholder lacked capacity, it is invalid. Establishing lack of capacity typically requires medical records, neuropsychological testing, expert witness testimony, and evidence of the policyholder’s mental state at the time of the change.” } }, { “@type”: “Question”, “name”: “What should I do if I suspect an illegal beneficiary change?”, “acceptedAnswer”: { “@type”: “Answer”, “text”: “If you suspect an illegal change, act immediately by obtaining all policy documents and beneficiary change forms, consulting with an experienced life insurance attorney, gathering evidence of fraud, undue influence, or lack of capacity, notifying the insurance company of your concerns, and requesting that proceeds be held pending investigation. Time is critical – delays can make evidence harder to obtain and allow fraudulent beneficiaries to receive and spend proceeds, making recovery more difficult.” } }, { “@type”: “Question”, “name”: “Can illegal beneficiary changes be resolved without going to court?”, “acceptedAnswer”: { “@type”: “Answer”, “text”: “Yes, many illegal beneficiary disputes can be resolved through mediation or settlement negotiations, which are often less costly and adversarial than litigation. However, this depends on the strength of your evidence, the willingness of other parties to negotiate, and the insurance company’s position. An experienced attorney can assess whether alternative dispute resolution is appropriate or whether court action is necessary to protect your rights and recover the benefits you’re entitled to receive.” } }, { “@type”: “Question”, “name”: “What are the consequences of an illegal beneficiary change?”, “acceptedAnswer”: { “@type”: “Answer”, “text”: “Consequences include the rightful beneficiary being denied life insurance benefits they were entitled to receive, prolonged legal battles and court proceedings among competing claimants, substantial legal costs for all parties involved, delays in benefit distribution during times of financial need, and potential criminal charges against those who committed fraud. The policyholder’s true intentions are thwarted, and family relationships can be permanently damaged. Taking swift legal action is essential to minimize these consequences.” } }, { “@type”: “Question”, “name”: “How long do I have to challenge an illegal beneficiary change?”, “acceptedAnswer”: { “@type”: “Answer”, “text”: “Time limits vary by state and the type of claim, typically ranging from one to six years for fraud or undue influence claims. However, discovery rules may extend these periods when fraud was concealed. Acting quickly is crucial because evidence deteriorates over time, witnesses’ memories fade, medical records may be destroyed, and insurance proceeds may be distributed and spent. Contact a life insurance attorney immediately upon discovering a suspected illegal change to preserve your legal rights and evidence.” } } ] } }