According to the 2020 Insurance Barometer report from industry groups LIMRA and Life Happen, 41 million people in the United States feel they need life insurance but do not have it. This can be explained in part by people’s proclivity to overestimate the expense.
Life insurance claims lawyer who has spent years in acrimonious, high-profile litigation, understands what his clients are going through because he has been there himself. Unfortunately, many claims for long-term disability insurance are denied.
A life insurance claims lawyer recognizes this unpleasant reality and strives to level the playing field by utilising his understanding of the insurance system to pursue the disability benefits his clients have paid into and earned.
Affordability and value perceptions can dissuade people from purchasing the life insurance they require. According to the Insurance Barometer Report, more than half of respondents believed a $250,000 term life insurance policy for a healthy 30-year-old would cost $500 or more per year.
However, the average annual expenditure is closer to $160. That’s a significant difference between perceived and actual cost.
A life insurance policy is a legal agreement between you and an insurance provider. In exchange for your premium payments, the insurance company will pay your beneficiaries a lump sum known as a death benefit following your death.
Your beneficiaries are free to use the money however they see fit. This frequently includes paying bills, paying a mortgage, or putting a child through college. Having life insurance as a safety net helps to ensure that your family can stay in their house and pay for the things you planned for.
There are two kinds of life insurance: term and permanent. Permanent life insurance, such as whole life insurance or universal life insurance, can give lifetime coverage, whereas term life insurance only provides coverage for a specified period of time.
Suicide within the first two years of owning the policy is the only exception to the policy’s coverage of all causes of death. Aside from that exclusion, life insurance protects against death caused by illness, disease, accidents, or homicide.
A life insurance company may deny a claim regardless of the cause of death if it considers any deception on the life insurance application, especially if the death occurs during the first couple of years of owning the policy. For example, if someone lies on their application about their health or other details, the life insurance company may deny the beneficiaries’ claim.
Life insurance claim lawyers fight for their clients when their claims for life insurance death benefits are denied, when there is a disagreement over the number of premiums required to keep the policy in force, or when mutual insurance firms fail to pay dividends.
The Common Reason For Insurance Claims Denial
Unfortunately, many life insurance beneficiaries are taken aback when they file a claim and the insurance company refuses to pay. You’ve relied on this benefit your entire life, and now that you need it, it’s simply not there. The life insurance lawyers and attorneys are well-versed in US insurance law and life insurance products.
They can tell when you’re not being handled fairly. Being experts on the subject they dedicated decades to assisting families in receiving the advantages of insurance they’ve purchased, despite barriers set in their path.
Life insurance companies are not all the same, and not all life insurance claims are handled equitably. Insurance companies occasionally go to tremendous measures to avoid paying a claim, especially if it is significant. While insurance companies employ a variety of strategies to avoid paying claims, the following are some of the most common:
1. Mishandle the Required Terms and Conditions
Most people mishandle the terms and conditions of insurance policies in a defective manner, which is one of the most common reasons for insurance claims being denied. Hiring an insurance claim lawyer is the best and most beneficial course of action in this regard. The expertise of an insurance claim lawyer can be of great importance in this regard.
If you do not pay your premiums in full and on time, your insurance may lapse, which means it will not be enforced and you will not be covered. As the beneficiary of a deceased spouse or parent’s life insurance policy, you may receive your first notice that the policy has lapsed when you file a claim for death payments under the policy.
They may claim that payment was never received or was not made on time, or there may be a disagreement about the amount of premium required to keep a policy in place. You may be aware that you paid, but verifying the facts surrounding an alleged lapsed payment can be challenging, particularly if the dead insured was the only one in the family. The assistance and guideline from an insurance claim lawyer can bring you positive results.
Another word for cancellation is rescinding. One method insurance firms use to avoid paying claims is to cancel or revoke the policy entirely. They go back to the initial application and thoroughly scrutinize it, then claim the insured lied on the application or neglected to complete a portion, so absolve them of any need to honor the contract.
When should an insurance firm assess a life insurance application for completeness and accuracy: when the applicant first applies for insurance or when the beneficiary files a claim, after decades of cheerfully accepting premium payments month after month, year after year? Insurance bad faith is demonstrated by the cancellation of a life insurance policy in order to avoid paying a claim.
Another form of denial is when insurers delay paying benefits in an unfair manner. One popular strategy is to repeatedly request information from you before making a decision. These requests may entail information that you genuinely cannot obtain (and they are aware of this), or they may just be demanding information with the intent of using it against you to deny your claim.
You’d think that submitting a claim requires relatively minimal information (such as a death certificate), but life insurance policies may be extraordinarily lengthy, complex, and highly technical paperwork with hidden traps built in that the ordinary consumer is unaware of until they make a claim.
5. The Death Happened During the Contestability Period.
Your insurer may look into whether you provided accurate information on your life insurance application if you pass away during the contestability period, which normally lasts two years from the day you bought your policy. Even if the cause of death had nothing to do with the deception, the carrier may refuse to pay the death benefit if you misrepresented it on your application.
A Florida man was found guilty in April 2014 of killing his recently wed wife so he could cash in on her $1 million life insurance policy. Weisbart claims that, surprisingly, schemes to kill the insured in order to receive life insurance benefits are common.
From the above discussion, we conclude that life insurance claims lawyers are aware of all the methods insurance firms use to avoid satisfying their legal obligations to policyholders.
Life insurance premiums and dividend amounts might be the difference between keeping a policy in effect and letting coverage lapse after years of payments. If life insurance rates suddenly increase, or if anyone is still obliged to make premium payments long after they were told they would “vanish,” life insurance lawyers will put a stop to the company and will bring you the desired results.