The Unexpected Can Happen At Any Moment!

Nashville Tennessee Estate and Business Planning

PUBLISHED ON: August 23, 2021

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It’s not a comfortable subject to discuss, which is understandable, but it must be done. Thinking about the day, we may lose a loved one is an unsettling thought. However, it is a conversation that we need to have and one we need to plan for.

What could add to the pain of a death in the family? Unfortunately, when the family is denied the life insurance benefits, they will need to help fill the financial gap left by their absence.

However, there are ways to avoid this situation! Below you will find some of the reasons that can cause a life insurance claim denial and the steps that you and your family can take to prevent this from ever happening in the first place!

Failure to make payment

Making late payments is something that the majority of us are familiar with, as are late fees. With life insurance companies, it’s a bit different. While other service providers may temporarily suspend their service until you pay, your life policy will be in danger of expiring. Fortunately, they understand things get in the way and will grant a grace period after the initial payment due date to avoid policy coverage expiration.

Your application is incomplete or incorrect

In this case, it is best not to leave anything meaningful out of your application; doing so will leave you open to potentially having your coverage denied when your family goes to claim the policy benefits.

A suicide during the policy’s contestability period

Experiencing the tragedy of a suicide is not something anyone wants to go through; when it comes to whether or not it can null the life insurance coverage is a little tricky.

When you take out a policy, there is a contestability period that lasts about two years, depending on the company. During this time, the insurance company evaluates your application, among other things, to ensure that no fraudulent actions were taken.

If suicide were to occur within this period, the beneficiaries would have the premiums already paid returned to them instead of having access to the policy’s benefits.

The best thing you can do here is to consult with an experienced attorney and read the fine print 

Suffering from intoxication or overdose

Depending on where you live in the U.S. and the circumstances of the policyholder’s death, the insurer may find just cause to deny any insurance claim if the death was proven to have been caused by intoxication or an overdose.

However, If there were trace amounts of alcohol found in the person’s body but not directly linked as the cause, it is unlikely that a claim can be rejected. The same unlikelihood applies if the person had a bad reaction to a drug while under the care of a physician.

Again, this is why it is essential to read the fine print and consult an attorney before you decide which life insurance company you choose to go with. 

If you are having difficulty battling the denial of your claim, then it might be time to hire a lawyer to help you out. While that may sound costly, there are ways to get around this and avoid any unnecessary stress.

There are two options to afford legal representation, either you pay the attorney’s hourly wage, or you agree to pay them a small portion of the insurance benefits if you decide to pursue the case. The second option is more open to people who might not have the funds to pay upfront costs. As long as you plan ahead and create a budget, then you should be able to resolve these matters.


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