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Top Reasons for a Denied Life Insurance Claim

Jason Turchin, Esq. Team

Navigating the aftermath of a loved one’s passing is challenging enough without the added stress of a denied life insurance claim. Yet, many families find themselves in this exact situation, struggling to understand why the financial safety net they thought was secure has suddenly been pulled away. Understanding the common reasons for claim denials can help policyholders and beneficiaries alike ensure that they are adequately protected.

1. The Contestability Period

One of the most common reasons for a denied life insurance claim is the contestability period – a window, typically the first two years after the policy is issued, during which the insurance company can thoroughly investigate and deny claims. If the insured passes away within this period, the insurer may scrutinize the claim more closely for any discrepancies or omissions in the application.

2. Misrepresentation on the Application

Closely related to the contestability period is the issue of misrepresentation. This doesn’t just cover outright lies but also includes failing to disclose a medical condition, smoking habit, or any risky hobbies. If the insurance company discovers that the policyholder did not provide complete and accurate information at the time of application, it can deny a claim—even if the undisclosed information seems unrelated to the cause of death.

3. Lapsed Policy Due to Non-Payment

Life insurance policies require that premiums be paid regularly. If payments are missed and the grace period expires, the policy may lapse, leaving beneficiaries without coverage. Insurance companies are strict about policy lapses, and unfortunately, many people do not realize their policy has lapsed until it is too late.

4. Exclusions Specified in the Policy

Most life insurance policies have exclusions that specify circumstances under which a death benefit will not be paid. Common exclusions include death from a risky activity, certain natural disasters, or acts of war. Suicide is also commonly excluded if it occurs within a specific time frame from when the policy was purchased.

5. Death Occurring in a Different Country

Some policies have geographical limits or may not cover deaths that occur in certain countries, often due to higher risks or difficulty in obtaining accurate death certificates and other documentation. Before traveling, it’s important to review your policy’s terms or consider additional coverage if necessary.

6. The Type of Death is Not Covered

Similar to exclusions, some policies may not cover certain types of death. For example, accidental death and dismemberment (AD&D) policies only pay out if the insured dies or is severely injured in an accident. If the death results from an illness, the claim will be denied.

7. Failure to Name a Beneficiary

While not as common, claims can be delayed or complicated by the absence of a named beneficiary or if the named beneficiary predeceases the policyholder and no contingent beneficiary is named. In such cases, the death benefit may go into the estate, subjecting it to probate and potential creditors.

8. Allegations of Fraud

In extreme cases, an insurance company may deny a claim if it believes that the policy was purchased with the intention of committing fraud. This could be due to suspicious timing (e.g., buying a large policy shortly before death) or inconsistencies in the application that suggest premeditation.

How to Avoid a Denied Life Insurance Claim

To prevent a denied claim, be thorough and honest when applying for life insurance. Review your policy’s terms regularly, ensure premiums are paid on time, and update your beneficiary designations as needed. If traveling, check if your policy has geographical limitations. Finally, consider consulting with a life insurance specialist to understand the intricacies of your policy.

What to Do If Your Claim Is Denied

If you face a denied life insurance claim, review the insurer’s reasons carefully. You have the right to appeal the decision, and many denials can be overturned with the right evidence. Consult with a lawyer with experience in life insurance disputes to explore your options and potentially contest the denial.


Understanding the reasons behind life insurance claim denials is often crucial for both policyholders and beneficiaries. By being aware of potential pitfalls and taking proactive steps to mitigate them, you can help ensure that the life insurance benefits will be there when they’re needed most. In the face of a denial, remember that you have rights and options to contest the decision, often with the assistance of an experienced life insurance attorney.

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