What You Need To Know About Filing Your Life Insurance Claim

You’ve recently lost a loved one, you’re overwhelmed with sadness, with the tasks of preparing for the burial service, handling the deceased’s final affairs, and now you have to file a life insurance claim.  The last thing you want to worry about is how best to deal with the life insurance company’s claims process.  Maybe you even need the life insurance benefit to pay for the funeral.  You call the life insurance company and are told that it could take 30-60 days to investigate the claim.  Now what?

Fortunately, most funeral services can proceed through an assignment of the life insurance benefit to the funeral home.  This is done by signing a document which assigns an amount of the life insurance benefit sufficient to satisfy the funeral home bill, after which the remainder of the proceeds, if any, will be paid to the beneficiary.  Unfortunately, though, more than 5,000 life insurance claims are denied every year in the U.S., sometimes leaving the beneficiary responsible for paying the funeral bill.

Many people don’t even know that life insurance companies can deny a life insurance claim.  The purpose of having a life insurance policy is to ensure that the designated beneficiary receives a specified amount of money upon the death of the insured.  It’s that simple, isn’t it?  Not quite.  Like with any insurance contract, there are complicated provisions and exclusions in life insurance policies, and applicable state and federal laws that can interfere with an anticipated claim payment.  Sadly, life insurance is a business, and life insurers maximize their profits by denying as many claims as possible.  A large percentage of denied life insurance claims are wrongful, and many of those claims are never disputed.  It’s a win-win for the life insurance company when a beneficiary gives up on a denied life insurance claim.

To protect yourself from the beginning, you should keep a few things in mind.  First, contact the life insurance company immediately, and notify it that the insured has passed away.  If the life insurance benefit was obtained through the insured’s employment, contact the employer for claim instructions.  The employer may instruct you to contact the life insurer directly, or it may submit the claim on your behalf.  Either way, you should request that the appropriate claim forms be sent by mail.  You can also download the forms from most insurance company websites.

If, for any reason, you are told that you are not entitled to claim the life insurance benefit, submit your request for the claim forms in writing or download the forms from the company’s website, if possible.  This could occur for several reasons, but most commonly because the life insurance company claims you are not the designated beneficiary, the policy has allegedly lapsed for nonpayment, or it has not yet taken effect.  Do not let the insurance company deter you from filing a claim.  Always Always ALWAYS file your claim and get a written explanation of the denial.  This will assist a life insurance lawyer in evaluating your denied life insurance claim.

To file your claim, you will need the insured’s death certificate, the claim forms, and a copy of the policy if you have it.  If you cannot locate the policy, that’s okay.  In certain cases, the life insurer may require that you submit a police report or other accident report, an autopsy report, a medical authorization form, or other supporting documents.  You will want to submit the death certificate and claim forms as soon as possible, and the life insurance company will notify you if any other information is required to process the claim.

Once you’ve submitted your life insurance claim, follow-up frequently for status updates.  Most life insurance claims should be processed within 30 days.  If an insured passes away within two years of the policy’s effective date, or if the policy is an accidental death policy, the life insurance company may request additional time to investigate the claim.  Even then, your claim should be paid within 60 days.  Life insurance companies benefit from delaying payments, so remember that the squeaky wheel gets the oil.  Keep calling, and make sure you know what’s happening with your claim at all times.

The most important thing, and I repeat, the most important thing to know is this: life insurance claims are denied all the time.  It is critical that you keep a complete record of all communications with the insurance company until the claim has been paid in full.  Keep a file folder of all documents submitted to the life insurance company and also all documents received from the company.  You should keep a log of all telephone calls, and include the dates and times of the calls, the names of the agents you spoke with, and notes about what the agent told you during each call.  Write down the agent’s direct quotes if possible.  Keeping good records can make the difference in whether a life insurance attorney decides to pursue your case, and ultimately whether your life insurance claim is paid.

Finally, if your claim is delayed for more than 60 days, or if it is denied for any reason, contact a life insurance lawyer without delay.  This is especially true for life insurance policies obtained through the insured’s employment because these claims are governed by ERISA, a federal statute with strict appeal deadlines.  ERISA appeals should always be filed with the assistance of an experienced life insurance attorney, as any future lawsuit will likely be limited to the appeal file, meaning no new evidence can be introduced at trial.  In all cases, policy limitations and/or state law will require that a lawsuit be filed within a certain time frame, and missing a filing deadline will forever bar your claim.

The Life & Property Insurance Law Offices of Heather D. Lee is a multi-state law practice offering free consultations and low contingent fees on all delayed and denied life insurance claims.  Please visit http://www.life-insurancelawyer.com for more information about how we can help collect your delayed or denied life insurance claim with no up-front costs for you.

Life & Property Insurance Law Offices of Heather D. Lee Now Serving Colorado & Florida

The Life & Property Insurance Law Offices of Heather D. Lee is now serving clients throughout the States of Colorado and Florida.  If you are an insured or beneficiary whose life insurance proceeds are being withheld during a difficult time, let us handle the life insurance company so that you can focus on recovering, and on your family.

Attorney Heather D. Lee offers free case evaluations and low contingent fee arrangements on all cases.  That means you can obtain quality legal representation without worrying about how to afford an attorney.  If we are unsuccessful in collecting your delayed or denied life insurance claim, you will owe no legal fees whatsoever.  Contact Us today at (800)403-5710 or visit www.coloradolifeinsurancelawyer.com and www.floridalifeinsurance.lawyer for more information about our law practice.

Insurance Consumers Win As Companies Are Made To Pay For Unfair Practices

Insurance consumer advocates have won another big battle recently, as the insurance regulatory agencies from Illinois, Indiana, Texas, Pennsylvania and Florida finalized a settlement with Bankers Life and Casualty Company.  Pursuant to the terms of the settlement agreement, the insurance company must pay a fine of $3.2 million for its failure to comply with regulatory recommendations imposed following an investigation of its practices in 2007.

The investigation found fault with many aspects of Bankers Life’s policies and procedures, including the company’s claims handling practices, and it ultimately led to the issuance of various recommendations to bring Bankers Life into compliance with states’ insurance regulations.  The 2012 review of the company’s progress revealed that it had failed to bring claims investigation, denial, and settlement procedures into compliance with the 2007 recommendations, specifically in the annuities, long-term care, and life insurance lines of business.

The settlement agreement reached with Bankers Life is just one of many recent settlements between state insurance regulatory agencies and insurance companies.  This trend is an important step forward for insurance consumers, as it shows that states are no longer willing to let insurance companies get away with unfair and misleading claims handling practices.  If your claim has been delayed or denied, you should consult with an experienced life insurance attorney to ensure that you are not a victim of non-compliant or abusive insurance practices.

To review the 2007 and 2012 agreements, visit http://insurance.mo.gov/Contribute%20Documents/conseco-bankers_Stip.pdf and http://insurance.illinois.gov/newsrls/2012/11/BankersExecutedRSA.pdf.

Don’t Let the Not Necessarily Limiting ‘Suit Limitation’ Clause Deny Your Rightful Claim

Insurance policyholders face many hurdles when a loss occurs.  One such hurdle involves the time in which a law suit must be filed after the insurance company denies your claim.  Suit limitation clauses greatly reduce the time-period to pursue even an illegitimate insurance claim denial.  While the Statute of Limitations for a breach of contract claim typically runs for 6-10 years (depending on the applicable state law), suit limitation clauses may reduce this window to as little as 12 months.  This is particularly problematic because limitation provisions are buried deep within lengthy, complex insurance policies and fail to provide actual and sufficient notice to policyholders.

Though a suit limitation clause functions much like a Statute of Limitations, in that both provide a specific time-period in which a suit may be brought, the difference between the two is important to note.  Significantly, a suit limitation clause is a condition imposed by contract, rather than by statute or law.  Therefore, the application or enforcement of a suit limitation clause may be challenged.

Like most issues relating to insurance policies, the law governing a contract’s suit limitation clause differs from state to state.  The majority of jurisdictions uphold such provisions, though some have not.  In those states where limitation clauses are considered valid, certain restrictions may be imposed on their use, with some states providing more protection for insured parties than other states.  Illinois, for example, extends the contractual limitation by the amount of time the insurance company takes to process the claim.  In other words, the period of time in which an insured may bring a law suit “tolls” for the number of days that pass from the filing of the claim to the date of the denial.

Further, states may provide additional protection against statute limitation clauses in the form of applying a notification requirement.  In Illinois, an insurance company waives its right to impose a time limitation clause if the denial notice does not include the remaining time-period for bringing a law suit.  The rules in Pennsylvania are less protective, on the other hand, with courts finding that a denial letter does not necessarily need to specify the amount of time to bring suit in order for a limitation clause to apply.

The effect of suit limitation clauses can be devastating to policyholders whose claims have been illegitimately denied, giving an insurance company the incentive to delay processing of the claim, and ultimately, the ability to escape liability.  If your insurance claim has been delayed or denied, you should speak to an insurance attorney immediately.  Even if you think too much time has passed to dispute your wrongfully denied claim, we may be able to help collect the life or property insurance proceeds you deserve.

The Insurable Interest Doctrine and Its Effect on Your Life Insurance Claim

It may seem surprising that life insurance claims are commonly denied, and for many different reasons.  Life insurance companies reportedly refuse payment on approximately 5,000 policies each year, although we believe this figure is much higher.  One interesting reason that life insurance claims can be denied involves the lack of an insurable interest.  According to the insurable interest doctrine, in most states an individual cannot take an insurance policy out on the life of another person without having a legally-recognized insurable interest in that person’s life.  In other words, one cannot insure the life of another unless he or she derives some benefit or advantage from the continuance of the insured’s life.  The law does not want to encourage the practice of “wagering” on the life of another.  Allowing an individual to procure a policy on someone’s life without requiring the existence of an insurable interest may open the door to crimes being committed against the insured person.

The rules setting forth what constitutes a sufficient relationship differ amongst the states.  Generally, states consider the insurable interest requirement to be satisfied by blood ties or other affection-based relationships.  In many states, a monetary tie such as a business partnership is sufficient to create an insurable interest.  The line drawn by the various state statutes remains fuzzy, to say the least.  The majority of courts have found that determining whether a relationship gives rise to a sufficient insurable interest is a fact issue, meaning it is determinable on a case-by-case basis.

Whether an insurable interest exists is relatively easy to determine in some relationships.  For example, a husband and wife will almost always be found to have an insurable interest in each other’s lives.  But what about an unmarried couple?  Or grandparents and grandchildren?  Even the relationship between parent and child is treated differently depending on the state where the policy is issued.  For example, Illinois courts have found that the blood tie alone can be insufficient and have, in some cases, required a showing of monetary interest in order to bolster the insurable interest.  In New York and Pennsylvania, on the other hand, the parent-child relationship alone establishes an insurable interest sufficient to take out a life policy.

To further complicate the insurable interest doctrine, courts have held that expiration of the contestable period for life insurance policies does not defeat a claim denial for lack of an insurable interest.  Typically, insurance companies have a 2-year period to challenge the validity of a policy.  The vast majority of jurisdictions have held, however, that a lack of insurable interest can be raised to challenge a policy’s validity at any time, even after the contestable period has passed.  In New York, an outlier state, life insurance companies cannot refuse payment on such a basis unless the challenge was raised within the contestable period, which begins to run on the policy’s date of issue.

The lack of uniformity with respect to what constitutes an insurable interest can cause a great deal of confusion for beneficiaries.  Without the assistance of an experienced life insurance attorney, a proper beneficiary may lose the right to collect against a policy based on an insurance company’s arbitrary determination that a sufficient insurable interest does not exist.  If your life insurance claim has been delayed or denied, you should speak to a life insurance lawyer about the facts specific to your case immediately.

Common Reasons For Delaying & Denying Life Insurance Claims

At least 5,000 life insurance claims are denied in the United States every year, and even more policies go unclaimed.  People are usually surprised to discover that life insurance companies can delay or deny claims for many different reasons.  In fact, most people believe that when an insured passes away, the beneficiary receives a payout immediately.  Unfortunately, this is too often not the case.  Like most businesses, life insurance companies are motivated by profit, having a strong financial incentive to collect premiums but later deny as many life insurance claims as possible, or to delay claims as long as possible.

DELAYED LIFE INSURANCE CLAIMS

If a life insurance company has failed to promptly issue payment of your life insurance proceeds, you may have a claim for breach of contract and bad faith insurance practices.  Life insurance companies must investigate your claim within a reasonable period of time, usually within sixty (60) days of the claim being filed or in accordance with the life insurance policy terms.  An insurance company may attempt to discourage you from hiring a life insurance lawyer by wrongfully delaying your life insurance claim, offering a reduced settlement amount, or making other efforts to avoid paying the full claim.

Some common tactics that life insurance companies will use to wrongfully delay your claim include but are not limited to the following:

Insured’s Death Occurring Within Contestable Period
Hospital Records/Medical Documentation Not Yet Received
Hospital or Medical Provider Refuses to Release Records
Failure to Provide Income Tax Returns
Failure to Provide Non-existent Medical Documentation
Independent Investigation Based on Suspicious Cause of Death
Independent Medical Review to Dispute Evidence
Beneficiary Dispute Based On Divorce
Beneficiary Dispute Based On Suspicious Cause of Death

No matter how badly you need the insurance proceeds, you should never accept a settlement offer without the advice of an experienced life insurance attorney.  An offer to settle your claim for a reduced amount may indicate that the insurance company’s reason for delaying or denying your claim is illegitimate.

To discourage beneficiaries from pursuing a wrongfully denied life insurance claim, life insurance companies will mail complex denial letters designed to confuse you.  Life insurance companies know that you are likely unfamiliar with the life insurance contract itself, or with your rights as the beneficiary.

Some common tactics that insurance companies will use to wrongfully deny your claim include but are not limited to the following:

Policy Lapse Due to Nonpayment
Misrepresentations Regarding Age, Employment and/or Income
Failure to Disclose Immaterial Pre-Existing Medical Condition
Failure to Disclose Medical Appointments/Regular Check-Ups
Failure to Disclose Unknown/Unofficial Medical Diagnosis
Failure to Disclose Condition Requiring Future Treatment
Failure to Disclose Prior Alcohol, Drug, or Tobacco Use
Failure to Disclose Criminal History on Application for Insurance
Accidental Death Related to Independent Medical Condition
Accidental Death Actually Self-Inflicted
Accidental Death Caused by Alcohol/Drug Use or Crime
Accidental Death Not Occurring Within Specific Time/Date
Accidental Overdose Caused by Misuse of Medication
Policy Not Active Due to Death Occurring Prior to Effective Date
Policy Not Active Based on Period of Limited Activity Exclusion
Independent Investigation Based on Suspicious Cause of Death
Insufficient Evidence to Show Heart Attack
Independent Medical Examiner Disputes Evidence
Change In Health After Policy Lapse Due to Nonpayment
Change In Health Condition Prior to Effective Date of Insurance
Handwriting Expert Claims False Application Signature
Failure to Elect and/or Qualify for Employment Coverage
Failure to Convert Employment Coverage to Individual Policy
Insurance Company Not Responsible for Agency Errors
Insured Not Resident of United States on Date of Death
Failure to Properly Change Beneficiary
Policy Lapse Due to Depleted Cash Value

Many insurance companies have large legal departments prepared to defend denied life insurance claims, which can discourage a beneficiary from hiring a life insurance attorney, appealing a denied life insurance claim, or filing a law suit.

The Life & Property Insurance Law Offices of Heather D. Lee, Esquire are familiar with the various tactics used by life insurance companies to delay and deny claims, and we are experienced in pressuring insurance companies to quickly complete the claims process and pay all proceeds due under their life insurance policies.  If your insurance claim is being wrongfully delayed or denied, Contact Us for your free case evaluation today.

 

Don Cornelius’ Ex-Wife May Collect $300,000 In Life Insurance Benefits Despite Suicide

The recent suicide of Don Cornelius and subsequent reports that his ex-wife, Viktoria Chapman Cornelius, is entitled to collect approximately $300,000 in life insurance benefits has caused a great deal of confusion.  Many of us wrongly assume that an act of suicide automatically precludes recovery against any life insurance policy.  In fact, no such “blanket” exclusion exists in life insurance law, and whether a beneficiary will collect life insurance proceeds following a suicide ultimately depends upon the terms of each policy.

On February 1, 2012, TMZ made a misleading report that Viktoria Chapman Cornelius has “score[d] huge life insurance payout” based on California law.  According to the TMZ Article, the ex-couple’s divorce decree provides that Viktoria was to remain beneficiary of two life insurance policies, and “[u]nder California law, if a policyholder commits suicide within [two] years of the time the policy is issued, the company can deny payment.”  TMZ prematurely concluded that because Don Cornelius took out the policy more than two years ago, Viktoria would undoubtedly collect the life insurance proceeds.  However, her right to the subject benefits cannot be confirmed without a thorough legal review of the life insurance contracts, and any reports based solely on “California law” are unfounded.

Typically, life insurance policies do expressly deny coverage for death by suicide, and such policies contain an exclusionary clause and often a definition of suicide.  For example, life insurance contracts may include a provision similar to the following: “If the insured, whether sane or insane, dies by suicide within two years from the date of the policy, no benefits are payable.”  These exclusions are generally recognized as valid.

An issue surrounding death by suicide arises, with or without an exclusionary clause, under Accidental Death & Dismemberment policies.  The concept of denying AD&D coverage for suicide is easier to understand because an intentional taking of one’s life can hardly be considered an accident.  In most cases, though, the life insurance company has the burden to prove that an insured’s death was committed with the requisite suicidal intent, and a mere intent to inflict pain which results in death will not be sufficient.  Indeed, numerous life insurance cases have involved an insured’s death caused by “erotic asphyxiation,” or the act of intentionally choking oneself or otherwise restricting oxygen to the brain for sexual gratification.  Under these circumstances, a self-inflicted death will not be considered an intentional suicide for the purposes of life insurance coverage.  Thus, while Viktoria Chapman Cornelius may collect the full $300,000 in benefits, additional information about the specific terms of Don Cornelius’ life insurance contracts is required to make a proper determination.

Don Cornelius was a pioneer whose enormous contribution to music, television, and popular culture will always be remembered and appreciated.  He is best known for his creation of “Soul Train” and its national exposure and tribute to decades of black artists and icons.  Don – wishing you eternal love, peace, and soul…