Life Insurance Claims Denial in Reno

Life insurance is designed to provide financial support to a family when they might need that support the most. For the policyholder, it brings peace of mind knowing that those benefits will protect their family and their legacy. That is why it can be especially upsetting to the surviving family members when their loved one’s life insurance policy is denied.

If you’re currently in a situation where you’re facing resistance from an insurance company over life insurance benefits, you need to speak to an experienced Reno insurance bad faith lawyer like you’ll find at the Law Office of Matthew L. Sharp.

We’ve successfully represented clients for many years in disputes with their life insurance company. Generally, people and businesses buy life insurance to provide financial protection in the event a loved one dies. In life insurance, the insured (the person whose life is being insured) designates a beneficiary.

The beneficiary is the person who receives the life insurance when the insured dies.

What Are the Common Areas of Dispute in Life Insurance Cases?

Before you can move forward with a life insurance denial claim, you have to understand what the potential dispute might be. That will help you and your attorney build a strong defense against the insurance carrier.

There are generally three areas of dispute in life insurance cases.

Material Misrepresentation

The first area of dispute is when the life insurance company claims the insured committed a material misrepresentation.

Essentially, the life insurance company is saying that the insured omitted or misrepresented material health information when he or she applied for the insurance. The law on material misrepresentation can be very complicated.

If you have an insurance company alleging material misrepresentation, you should get legal advice.

Beneficiary Dispute

The second area of dispute is when there is a dispute about who the insured designated as beneficiary.

Generally, the insured is considered the owner of the insurance policy. He or she has the right to designate a beneficiary. Typically, the beneficiary is first designated when the insured applies for the life insurance. The insured has the right to change the beneficiary at any time and for any reason.

Also, they can change the beneficiary by providing the insurance company with written notice.

Sometimes, a dispute will arise concerning who the beneficiary is. The issues will be: (1) when the beneficiary was changed; and (2) whether the beneficiary change was sufficient to notify the insurance company of the insured’s intent.

If you are involved in a dispute over the beneficiary of the life insurance policy, you need to get legal advice.

Qualified Policy

The third area of dispute concerns whether the life insurance took effect before the insured died.

A life insurance policy has an effective date. Sometimes, there are insurance policy provisions defining when the policy takes effect. If the insurance company tells you the policy was not in effect, you need to seek legal advice.

Once you’ve narrowed down what the insurance company is claiming, you and your attorney can build a strong defense for the appeal.

Frequently Asked Questions

Here are some answers that can help you find clarity around this type of claim:

Can an insurer deny a life insurance claim if the death occurred during an illegal activity?

Every life insurance policy comes with exceptions for benefit payouts. Many policies exclude coverage for a death that occurred during the commission of a crime. For instance, if someone dies while fleeing law enforcement, the insurance company could deny their claim if that type of incident is stipulated in the policy.

If we missed a premium payment, can a claim be denied?

One of the first issues that an insurance company will investigate is whether the policy is current. If the policy has gone unpaid and lapses, it can trigger a denial.

Is my spouse’s ex entitled to life insurance benefits?

A former spouse could make a claim against the life insurance benefits of your spouse if there was an agreement in the divorce for that type of dispersal. There might also be an issue if the policy was issued through your spouse’s employer.

In that case, it might be governed by federal regulations with regard to beneficiary dispersal. This is why it is important to have clear directives put in place for estate planning.

Contact Our Attorneys for Advice

It is important to understand that, as a beneficiary, you have certain rights in dealing with your life insurance company. In general, the insurance company owes you a duty of good faith and fair dealing to treat you fairly and in good faith. Our goal is to help you understand your rights when dealing with an insurance company.

If you think your insurance company is treating you unfairly, please contact us as soon as possible to schedule an initial consultation.