Life Insurance Claim Articles

Life Insurance Denied Due To Lapse In Payment

By Jeffrey L. Greyber, Esq.

Today I would like to discuss life insurance denials, one of the worst of its kind. Specifically, I would like to address a life insurance denial due to a lapse in premium payment. Many times, leading up to a policyholder’s unfortunate passing, the policyholder might find his or herself incapacitated to a degree, whether it is physically or mentally. In this condition and predicament, it is highly unlikely that paying a life insurance premium is weighing heavily on the policyholder.

I have attested numerous instances in which a policyholder has passed, and when the beneficiary gets around to collecting from the insurance company, they come to find out that the policyholder, the deceased, failed to pay their premium for some time. Thus, there is no longer any coverage in effect. This is a heart wrenching ordeal on top of a heart wrenching ordeal.

Unfortunately, these are things, as a policyholder or loved one of a policyholder, which you need to be proactive about. When a loved one, family or friend goes into a hospital or nursing home, or starts to become mentally or physically incapacitated, remind them that it is important to keep up on their premiums.

Ideally, the best way to avoid this deplorable situation in the first place, is to ensure that said policyholder of the life insurance policy has an automatic debit payment procedure for their premiums. It is understandable that not everyone is comfortable with technology in that manner, but it truly is the best and easiest way to safeguard the life insurance premium payments. If an automatic payment is not possible, it is recommended that the beneficiary pay close attention and follow up with the insurance company.

There is typically a "grace period provision" within the insurance policy, when it comes to missing a premium payment or two. If that lapse of payment can be caught within this grace period, then all coverage is still in effect, and you can pick up payments where they were left off to complete the policy. If the grace period has in fact been missed, there are still some moves to that can be made by an attorney like me. Has the insurance company reached out to the policyholder in the case of a missed payment? Contact following a missed payment is often times required of the insurance company under the policy.

As you approach the passing away of a loved one with a life insurance policy, it may not be at the forefront of your mind, but it is important to keep your ducks in a row as they say, and ensure the premium payments are kept up to date. If you still find the insurance company attempting to sweep the grace period provision under the rug or are being denied life insurance coverage due to lapse in payment, please do not hesitate to contact Merlin Law Group.

Life Insurance Claim Articles