Can a life insurance company deny a claim on a valid policy if the insured dies?

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Can a life insurance company deny a claim on a valid policy if the insured dies?

No specific case, just a general question

Asked on August 31, 2018 under Insurance Law, Alaska

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 3 years ago | Contributor

As a general matter, payment may be denied if:
1) There was some fraud or misrepresentation made in applying for or getting the policy--e.g. the insured lied about their health.
2) The insured failed to pay all premiums.
3) The beneficiary trying to claim is not the one listed in the policy (the policy pays only to the person[s] listed as beneficiary--it doesn't matter if someone else is a spouse, child, etc., if not named as a beneficiary, they will not receive the policy proceeds).
4) The beneficiary can't prove his or her identity.
5) The beneficiary caused the insured's death (you can't profit by contributing to or causing another's death).
6) There was a valid exclusion under the policy: for example, many policies will not pay out for suicide until after some specified number of years, to keep people contemplating suicide from taking out a policy shortly before they kill themselves.
7) No claim for benefits is made until too many years have passed after the insured's death. An insurance policy is a contract; any contract, including an insurance policy, can only be enforced (e.g. sued over) for a certan number of years, called the "statute of limitations"; in Alaska, the stature of limitations is three (3) years after the contract/policy should have been paid; so after more than three years after the insured's death, the insurer does not need to pay any longer.


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