Understanding the Reason for the Denial 
The initial reaction after a life insurance claim denial is often one of confusion and frustration. The first action beneficiaries should take is understanding why the claim was denied. Insurance companies are legally required to provide a reason for the denial, and this is typically included in the denial letter.
Common reasons for life insurance claim denials include:
- Failure to pay premiums: If premiums are not paid, the policy may lapse, leading to a denial.
- Misrepresentation or omission of information: Insurance companies may deny claims if they believe the policyholder made material misrepresentations when applying for the policy.
- Policy exclusions: Some policies have exclusions for specific causes of death, such as suicide or deaths resulting from criminal activity.
- Incontestability clause: This clause, which often applies during the first two years of the policy, may be invoked if there is any question regarding the validity of the policyholder’s death.
Contacting the Insurance Company for Clarification
Once the reason for the denial is clear, the next step is to contact the insurance company directly. Sometimes, the reason behind the denial may be unclear, or there could be misunderstandings or errors in the documents or claims process. By reaching out to the insurance company, you can ask for clarification or further documentation. While contacting the insurer, remember the following:- Request a copy of the policy: It’s essential to fully understand the terms of the policy, including any exclusions or conditions that may apply.
- Ask for the evidence: Request the insurer’s records related to your claim. This could include the medical records, statements, or reports they used to make their decision.
- Document everything: Keep detailed records of all communications with the insurance company. Write down the names of representatives you speak with, their job titles, the date and time of the conversation, and any details discussed. This documentation will be valuable in case you need to file an appeal or pursue legal action.
We contacted Trief, Olk & Dror to help us with a life insurance issue and Shelly Friedland was the attorney assigned to our case. Before Shelly took our case she explained to us that the likelihood of our success without going to court was possible but not likely. Unfortunately we did not get the outcome we had hoped for but it was our decision to not move forward and have our case litigated. Shelly is very knowledgeable and was very straight-forward in her assessment of our case as we moved forward. She was very patient and thorough in answering our questions. She always responded in a timely manner and listened to our concerns. We would certainly recommend Shelly and would use her firm again in the future.”
- John Ramig
If there is any possibility of winning your life insurance case – this is the place to do it for you. They are efficient, honest and will achieve the best possible outcome.
Shelly Friedland worked on my case where a life insurance policy had lapsed and was even a few days beyond the grace period. Farmers had rejected my claim twice and was unwilling to take a second look. Shelly was able to get them to pay the entire claim without going to court, and the full amount was deposited in my account within a couple months. Highest recommendation.”
- Kathleen Brown
Trief, Olk & Dror is a superior law firm. Their attorneys and other legal professionals have a brilliant understanding of the law and the litigation process. They diligently perform their work in an efficient, strategic and cost-effective manner to ensure the best possible outcomes for their clients.
- Christopher Hughes
Review the Terms of the Policy
The next important step is to carefully review the terms of the life insurance policy. It’s important to understand the exact coverage, exclusions, and terms that apply to the claim. Often, life insurance policies can be difficult to understand, especially when it comes to terms related to exclusions, contestability periods, and the types of claims that are eligible for payout. Key things to look for in the policy include:- Contestability Period: This is a period, usually two years, during which the insurance company can investigate and potentially deny claims based on misrepresentation or fraud.
- Exclusions: These are conditions under which the insurer is not liable to pay out, such as death due to suicide, participation in dangerous activities, or acts of war.
- Grace Periods: If the claim was denied due to non-payment of premiums, check whether there is a grace period provided in the policy that allows the beneficiary time to pay overdue premiums and reinstate the policy.
Settlements & Verdicts
Seek Professional Legal Assistance
The process of challenging a denied life insurance claim can be complex, especially if the insurer has invoked a technical clause, such as a lapse in coverage or a misrepresentation. For many beneficiaries, consulting with a lawyer who specializes in life insurance claims is the next step. An attorney can help you navigate the legal intricacies involved and ensure that you are in the best possible position to challenge the denial. At Trief, Olk & Dror, we have extensive experience in handling life insurance claims and disputes. Our legal team can provide you with the guidance and support needed to understand your rights and explore all available options. Whether the issue is a policy lapse, material misrepresentation, or a misunderstanding with the insurer, we are here to help you. Legal assistance can be particularly valuable when dealing with the following:- Understanding the insurer’s obligations: An attorney can explain how the insurer is required to handle the claim and whether their denial was in accordance with the law.
- Gathering necessary evidence: A lawyer can help you gather all necessary documents, including medical records, policy details, and other evidence that may be crucial for your case.
- Handling appeals and litigation: If necessary, a lawyer can assist with filing an appeal or pursuing litigation if the claim denial is unjust.
Filing an Appeal
If you believe that the insurance company wrongfully denied the claim, you have the right to file an appeal. Each insurance company will have its own specific process for appeals, but typically this involves submitting a formal request for reconsideration and providing additional documentation to support your case. The key elements of the appeals process include:- Timeliness: Pay close attention to the deadlines for filing an appeal. Insurance policies often specify a time frame (e.g., 30 to 60 days) for contesting a claim denial. Missing this deadline could prevent you from pursuing your claim further.
- Submitting Supporting Evidence: Include any documents that may strengthen your case, such as updated medical records, letters from doctors, or expert testimony.
- Legal Assistance: Having a lawyer assist with the appeal process can ensure that all necessary steps are followed correctly and that your appeal is as strong as possible.
Be Prepared for Further Action, Including Litigation
If your appeal is unsuccessful, the next option is litigation. Filing a lawsuit against an insurance company can be a lengthy and complicated process, but it may be necessary if the insurer refuses to pay the claim despite strong evidence in your favor. Litigation may involve:- Filing a breach of contract claim: You may need to file a lawsuit arguing that the insurance company is in breach of its contract and should honor the policy.
- Proving bad faith: In some cases, you may be able to file a claim for bad faith if the insurance company’s denial was unreasonable or unfair.