Our life insurance lawyers in Vermont handle delayed and denied life insurance claims, AD&D claims, beneficiary disputes and Vermont interpleader lawsuits.
Life insurance claims can be denied if fraud or material misrepresentation occurred at the outset, typically during the application process. Insurance companies rely on the accuracy and completeness of the information provided by the policyholder to assess risk and set premiums. If fraud or misrepresentation is discovered, it can lead to the denial of a life insurance claim. Here are various ways a life insurance claim can be denied due to fraud or misrepresentation at the outset:
Concealing Medical History: If the applicant intentionally conceals or misrepresents their medical history, such as pre-existing conditions, medication use, or previous surgeries, and these omissions are discovered, the claim may be denied.
False Lifestyle Information: Providing false information about lifestyle factors, such as smoking habits, alcohol consumption, or participation in high-risk activities (e.g., extreme sports), can lead to claim denial if these factors were material to the insurer’s underwriting decision.
Incorrect Age or Identity: Falsifying age or identity on the insurance application can result in claim denial if the insurer determines that the policy was issued based on incorrect information.
Income and Financial Status: Misrepresenting income or financial status when applying for policies with coverage amounts that depend on income can lead to claim denial.
Non-Disclosure of Other Policies: Failing to disclose existing life insurance policies or misrepresenting the amount of coverage in force can result in claim denial, especially if the total coverage exceeds the applicant’s insurability limits.
Occupation or Employment: Providing false information about one’s occupation or employment status can lead to claim denial, particularly if the applicant’s occupation carries higher risks.
Travel and Residency: Falsifying information about travel plans, residency, or citizenship status, especially if it relates to high-risk locations or travel restrictions, can result in claim denial.
Criminal History: Concealing or misrepresenting criminal history, such as prior convictions or pending charges, can lead to claim denial if the insurer’s underwriting criteria consider this information relevant.
Misrepresentation of Beneficiary Information: Providing false or inaccurate beneficiary information on the application can lead to complications in the claims process, although it may not necessarily result in a complete denial of the claim.
Signature Forgery: If the applicant’s signature on the insurance application is forged or not genuine, it can invalidate the policy, leading to claim denial.
Collusion or Fraudulent Activity: Engaging in fraudulent activities with others, such as staging a death or intentionally causing a loss with the intent of collecting the life insurance benefit, can result in the denial of a claim.
It’s important to note that insurance fraud is illegal and can have serious consequences, including denial of the insurance claim, voiding of the policy, and potential legal action against the policyholder. Insurance companies have processes in place to investigate claims, and they may review medical records, conduct interviews, and consult external databases to verify the accuracy of the information provided in the application. To ensure a valid and successful life insurance claim, applicants should always be truthful and provide complete information during the application process.