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Reasons your life insurance claim may be denied

Shawn E. McDermott

Life insurance can offer much-needed benefits to your dependents following the financial impact of your demise. With life insurance benefits, your loved ones can receive the finances they need to maintain the standard of living and/or provide for your dependents.

However, it is not uncommon for the insurance company to deny a valid life insurance claim. And as you can imagine, this can leave your grieving dependents in a financially difficult position. So, when can your life insurance claim fall through the cracks?

Here are three reasons why the insurance company may refuse your life insurance claim.

Non-disclosure of medical conditions

While signing up for life insurance coverage, it is imperative that you disclose all known medical conditions. Failure to disclose every condition asked may lead to the refusal of the claim on the grounds of material misrepresentation.

Non-payment of premiums

Your policy will only remain active as long as you are paying your premiums. Missed or delayed payments can easily lead to the refusal of the claim.

That said, it is not uncommon for the insurance company to deny a claim on the grounds that they did not receive your payment. This is especially common if you mailed your payment or set auto-payments. This is why it is important that you keep a record of all your payments.

When the type of death isn’t covered in the policy

Most life insurance carriers have exclusions regarding the type of death. These exclusions may include things like suicide. If you take your own life, especially before the contestability period, then your dependents may not receive the benefits.

Life insurance claims can be complicated. One single misstep during the application process and your claim could be wrongfully denied. Learning more about Colorado life insurance laws can help you avoid mistakes that can lead to your claims’ refusal.

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