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Life Insurance Material Misrepresentation Claim Denial
Our life insurance lawyers may still be able to get a claim paid if it was denied for material misrepresentation. If your life insurance claim is being delayed so the life insurance company can look into the insured’s prior medical records, or if your life insurance claim was denied for material misrepresentation, call us now for a free consultation at (800) 337-7755. Some policies may still be payable. We’ve recovered millions of dollars in denied or delayed life insurance benefits, and can review your claim to see if you still may be entitled to benefits.
We handle life insurance claims on a contingency fee basis, which means you don’t have to worry about paying us out of pocket to assist with your claim. We only get paid if you recover money from your life insurance claim. Call one of our Florida life insurance lawyers today to find out if you are entitled to compensation at (800) 337-7755.
Life insurance companies often look for any way to deny a claim once the insured dies. One of the most common delay or denial tactics is where the insured died within 2 years of taking out the insurance, or being listed as the insured on a policy. When this happens, many insurance companies will try to obtain all of the insured’s medical records to compare the records with statements made on the life insurance application. If they find any difference, like where a box was checked “No” but should have been checked “Yes”, the Florida life insurance company will often deny the claim for Material Misrepresentation. Do not accept this without speaking with a life insurance attorney at the Law Offices of Jason Turchin.
Most Life Insurance Policies Have an Incontestability Provision
Most life insurance policies have a provision which says they are not contestable after they have been in effect for more than 2 years, with some exception. This gives many life insurance companies the right to look at the policy application and statements made compared with the medical history or other information on the insured, if the insured dies within 2 years of taking out the policy, or possibly within 2 years of a reinstatement.
Under Florida Statute section 627.455, every insurance contract must provide that the policy shall be incontestable after it has been in force during the lifetime of the insured for a period of 2 years from its date of issue except for nonpayment of premiums and except, at the option of the insurer, as to provisions relative to benefits in event of disability and as to provisions which grant additional insurance specifically against death by accident or accidental means.
This 2 year incontestability provision can be confusing and tricky for some policy owners. If you change your policy coverage, some life insurance companies may try to invoke a new 2 year incontestability clause even if your policy was already in effect for more than 2 years. Some may also try to invoke a new 2 year incontestability clause if your policy is reinstated after a lapse. Do not accept these denials or delays without speaking with a life insurance attorney, as the facts or policy language may not entitle the life insurance company to invoke this provision.
What is a Material Misrepresentation?
Under Florida law, any statement or description made by or on behalf of an insured or annuitant in an application for an insurance policy or annuity contract, or in negotiations for a policy or contract, is a representation and not a warranty. This means that a policy may still be payable even where there is a misstatement on an application. Florida law allows a life insurance company to revoke a life insurance policy if there was a “material misrepresentation” in the procurement of the insurance policy, but this has limitations and exceptions. These exceptions may still entitle you to insurance benefits even where a life insurance company may try to revoke or deny a life insurance policy for “material misrepresentation”.
Florida Statute section 627.409 describes the representations in insurance applications and their effect on the policy. In general, a misrepresentation, omission, concealment of fact, or incorrect statement does not prevent recovery under the contract or policy.
It will only result in a denial of coverage if any of the following apply, in accordance with Florida Statute section 627.409:
- The misrepresentation, omission, concealment, or statement is fraudulent or is material to the acceptance of the risk or to the hazard assumed by the insurer.
- If the true facts had been known to the insurer pursuant to a policy requirement or other requirement, the insurer in good faith would not have issued the policy or contract, would not have issued it at the same premium rate, would not have issued a policy or contract in as large an amount, or would not have provided coverage with respect to the hazard resulting in the loss.
This plainly means that a Material Misrepresentation in and of itself does not always mean the policy should not be paid. It must fall within these limited exceptions.
The Standard to Apply When Reviewing a Material Misrepresentation
Life insurance policies often have different language in the representations made by the applicant or insured when applying for life insurance. There is no real standard language, and Courts often look at two categories. Some policies are more direct asking the applicant to sign the application by stating that the answers are true and correct. Other policies are more liberal stating that the applicant’s answers are true and correct “to the best of the applicant’s knowledge and belief.”
The “knowledge and belief” standard is very difficult for a life insurance company to overcome. How do they know what the applicant “knew” at the time of the life insurance application was completed? How do they know what the applicant “believed” to be true at the time the life insurance application was completed?
The language used by the life insurance company may make a big difference in the burden the parties have to overcome in proving their case.
Example: A life insurance applicant did not have full understanding of medical terminology. The applicant may have known he had breathing difficulty, but it was under control. The policy asked if the applicant had “COPD” and the box was checked “No”. The applicant did not know what the medical term was for his condition and reasonably believed the answer was correct. However, after the insured/applicant died within 2 years of the policy becoming effective, the life insurance company investigated the claim. The insured’s medical records included a diagnosis of COPD. If the policy application was signed by the insured “to the best of his knowledge and belief”, then the policy should be payable. The insured’s representations were true and correct to the best of his knowledge and belief, even if they were contrary to the medical records. There was no intentional misrepresentation in the application.
Many insurance companies opt to have an insured also disclose medical providers and provide a signed medical authorization with the policy application. This gives the insurance company the right to investigate the answers within the 2 year period either before affording coverage, or while it is in effect. If a life insurance company chooses not to investigate before the person dies, a Court could find that they waived their right to challenge the representations in the insurance application or they may be stopped from challenging the policy, under what is called equitable estoppel or promissory estoppel.
Call us for a Free Life Insurance Claim Consultation!
At the Law Offices of Jason Turchin, we will look at your life insurance claim to see if it is payable. Do not just accept a refund of premiums on a policy just because the life insurance company says they won’t pay. Feel free to contact us for a free consultation.
Contact our firm now or call (800) 337-7755. It’s a free consultation.
At the Law Offices of Jason Turchin and through our network of nationwide life insurance attorneys, our life insurance attorneys can represent you in Florida, and throughout the United States.
If you need a Miami life insurance lawyer, Orlando life insurance claim lawyer, Broward life insurance attorney, or Florida life insurance attorney, give us a call today for a free consultation.