Not All Deaths Are Covered by Life Insurance
- June 29, 2018
If you are the beneficiary of a life insurance policy — whether in Illinois or elsewhere — then you may find that the insurer unexpectedly denies your claim on the basis of an exclusion written into the policy (that you were not aware of). This can put you in a uniquely vulnerable position as a beneficiary. After all, if you were reliant on your loved one for resources, then the life insurance proceeds are critical to your ability to bounce back financially.
Depending on the nature of the exclusion and the circumstances surrounding your loved one’s death, however, it is not necessary that you accept the determination of the insurer. In fact, you may be able to challenge the adverse decision of the life insurance company and force them to payout the benefits that you’re owed.
When contemplating the various exclusions commonly written into life insurance policies, it’s important to note that every policy is different — though many life insurance policies will exclude deaths due to extreme activities (i.e., bungee jumping), for example, some insurers remove these exclusions for policyholders who are willing to pay a premium for broader life insurance coverage. You should therefore conduct a thorough evaluation of the life insurance policy to assess the applicable exclusions.
Consider the following commonly-encountered life insurance exclusions.
Policyholder Suicide
In most life insurance policies, the insurer will exclude coverage in situations where the policyholder commits suicide. This is a fairly common exclusion, as it is designed to protect the insurer in situations where the policyholder is desperately looking for a way to settle their family’s debts through a life insurance payout.
Though the suicide exclusion may seem like an insurmountable barrier to recovery, it’s not immune to attack. In fact, insurers will — in many cases — have a difficult time proving that your loved one actually committed suicide. If the intention of the policyholder is not certain, then you can undermine the insurer’s determination that the death was a suicide, as opposed to an accident, and force the insurer to pay benefits.
For example, if your loved one fell off a building and died due to the fall, the insurer may try to rule it a suicide (to avoid paying out benefits). The evidence may be rather mixed, however. If there is no suicide note, and if other evidence points to the fall being an accident, then you could ostensibly secure benefits.
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Extreme Activities
Deaths due to certain extreme or dangerous activities — recreational and otherwise — may be excluded from coverage. Generally speaking, only specified activities are excluded. For example, if the life insurance policy only specifically excludes deaths due to bungee jumping and base jumping, but your loved one died in a hang-gliding accident (which was not listed in the exclusion), then you could arguably still be entitled to receive benefits.
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Specific Illnesses
Some life insurance policies include death exclusions for specific illnesses. In the past, HIV used to be a common exclusion, though that has become quite rare in the today’s life insurance industry. Remember, the illness must be sufficiently specific — a vague description of illness will not be enough to exclude coverage.
War-Related Death
If your loved one dies in war, or in some other military conflict (i.e., a serious conflict that is not part of a formal war), the death may be excluded from life insurance coverage. The war death exclusion is not as common as it used to be (in the 20th century), but some insurers will write it into the policy if the policyholder faces unique risks. For example, a marine infantryman may be given a war death exclusion, whereas the exclusion may not be necessary for an air force mechanic.
Drug and Alcohol Abuse
Though drug abuse may lead to an accidental overdose, life insurers frequently exclude such deaths from coverage. Not all drug overdoses will necessarily be excluded, however. If the policyholder dies due to an unexpected reaction to a prescription drug, then benefits can be paid out.
Contact a Skilled Chicago Life Insurance Denial Attorney for Guidance on Your Claims
If you are the beneficiary of a life insurance policy, then you may find that — despite the fact that your loved one has died — the insurance company has denied what appears to be a legitimate claim for benefits. An unexpected life insurance claim denial be particularly challenging for those who are still grieving and attempting to “right the ship” financially in the wake of their loved one’s death.
Here at Bryant Legal Group, P.C., our Chicago-based attorneys have decades of experience representing policyholders and their beneficiaries in disputes with their insurers, including those that relate to life insurance claims. We have a “client first” approach to legal representation that separates us from our competitors. We are committed to keeping clients apprised of developments in their case, and we handle disputes comprehensively — first we resubmit claims and challenge adverse decisions through the internal administrative appeals process. If necessary, however, we will bring an action against the insurer and pursue traditional litigation.
Call (312) 561-3010 or submit an online form on our website to connect to an experienced Chicago life insurance denial attorney here at Bryant Legal Group, P.C.
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