Has Your Life Insurance Company Denied Your Claim?
You can’t believe the news: Your loved one has suddenly died. A few weeks later, you can’t believe the news, again: the life insurance company claims denial. The life insurance company refuses to pay even the small policy benefits – $25,000 – to you and the other beneficiaries. What kind of a life insurance company would refuse to pay a small policy, knowing the insured person is gone?
The answer to a life insurance company claims denial, even a small but important policy, is based on the life insurance rescission law in California.
- In California, a life insurance policy is generally considered “incontestible” two years after it is issued, or the application is filled out. Incontestible or incontestibility is a law and legal doctrine intended to provide some added certainty that a life insurance policy will be paid.Incontestibility requires that after two years, a life insurance company no longer has the right to refuse or deny a claim (or rescind a life insurance policy) based on a “misrepresentation” in the life insurance application.Unfortunately, life insurance companies have turned the incontestibility law upside down, taking the law to give them a wide territory to rescind and deny life insurance claims on policies that have been in force less than two years. In fact, the life insurance companies that sell these smaller policies use the incontestibility law in just this way.
To save money – their money – these companies don’t do much or anything to investigate a life insurance application. They are just interested in getting the business, and accepting the money for the premium. If a person loses their life in the first two years of the policy, for a medical reason, only after a claim comes in, will the life insurance company perform its investigation.
Here’s a great article on the rights on the insured.
A Life Insurance Company Claims Denial is no reason to consider your case closed.
To us, it’s the start of a process that will get your claim paid. But the insurer wants to to see it as final, and to therefore give up your efforts. That way, they get to keep YOUR money.