Mansell, Engel & Cole

What are valid reasons to deny a life insurance claim?

Many Oklahoma residents are struggling with legal situations having to do with life insurance. Perhaps you can relate to such situations from first-hand experience or because you have been helping your aging parent address long-term care needs. Life insurance companies often try to deny claims. The question you must answer if this happens to your family is whether the denial was for a valid reason. 

Short of committing fraud, there are not many reasons that a life insurance company can deny your claim. The problem is that such situations are often complex and if you do not have a legal background regarding the issue, it can be quite difficult to understand whether what your insurance agency is doing is okay. That's why it helps to research the topic ahead of time and to have support access in mind should a problem arise.  

Reasons to deny a claim 

If you try to deceive your insurance company and they discover the deception, you can expect that the agency will likely deny any claim you happen to file pertaining to the matter. The following list explains this further, in addition to other valid reasons you may face a denial:  

  • Fraud: If you are the policyholder and you know you have a terminal illness but do not disclose the information to your life insurance company, it constitutes grounds to deny your claim. 
  • Contestability period: An insurance company can deny a claim within a certain amount of time after a policyholder dies. If the contestability period has passed, they must pay the claim; an exception would be if the policy stated that the agency has an indefinite amount of time to issue a denial.
  • Exclusions: Policies often include certain stipulations that would enable a life insurance company to deny a claim. However, the policy must clearly explain such exclusions, which the policyholder can review.  

In short, if it's written in your policy that your insurance agency will deny a claim if you die while riding a motorcycle, then that would be a valid reason to withhold payment. It is always a good idea to carefully review a policy ahead of time and to ask someone well-versed in long-term care planning laws to review it as well. If you're trying to resolve an issue involving your parent's long-term care plan, you can seek legal support so you don't have to handle it alone.

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