How to Get a Death Claim Paid After its Been Denied
Poor Kim from Baltimore. There was never a more soft-spoken, kind woman. But even she became furious when her husband’s life insurance claim was denied. He’d had the policy for ten years and now, when she really needed the money to pay for his funeral, the insurance company was not going to pay her claim.
What happened?
Kim’s husband had a successful small business, a wife, and son named Junior. Being a responsible man, he bought a $200,000.00 life insurance policy just in case something happened to him. Even though he was an avid weight-lifter and frequently went to the local gym for exercise, his blood pressure was high. His doctor started him on a low-dose blood pressure medicine which kept his readings in normal limits.
When he applied for the life insurance policy he told the insurer about his high blood pressure. The insurer issued him a policy at a standard rating and for the next nine years Kim’s husband made his premium payments right on time. During those nine years he developed diabetes. Unfortunately, in year ten he missed a premium payment, and because his policy only had a 30-day grace period, he had to complete special paperwork in order to keep his policy.
That paperwork – known as a Reinstatement Application – was like starting all over. There was a whole battery of questions about his current health. For whatever reason, he answered “no” to diabetes, and sent the questionnaire back to the insurer. They then put his policy back into effect, but they also restarted his 2-Year contestability period.
Sadly for Kim, she lost the love of her life later that same year. She gave him the funeral she wanted him to have and it cost her nearly $15,000.00. Kim’s financial plan was to use part of the life insurance money to pay for the funeral. As they often do, the funeral home accepted a promise to pay and a collateral position in the death claim as security for the funeral bill. Kim quickly filed her death claim, and almost as quickly the insurer denied it.
Why the Claim was Denied
The insurer said that if they had known Kim’s husband was diabetic they never would have reinstated his policy. Kim was shocked and now stressed about how she’d pay the funeral director.
We Investigate and Uncover the Evidence to Get the Claim Paid
We opened an immediate investigation by reviewing the medical records and the laboratory testing results for blood glucose, blood pressure, ancillary tests, as well as recording trends.
Knowing that diabetes is not enough of a reason to deny a death claim, we set-out to determine exactly how an underwriter would have issued the policy if he did know about the diabetes. Type 1 diabetes is a condition that makes life insurance premiums more expensive than type 2 diabetes does, but both are insurable. Luckily, Kim’s husband was a type 2 diabetic.
His medical history showed that he didn’t have great control of his glucose, but it was more than adequate, based on the history of his testing results, and it was trending in the right direction up to the time he reinstated his policy.
With life insurance underwriting, even if someone has a condition like high blood pressure or diabetes, if their medical records show good control of the condition it can actually off-set another condition they don’t have good control over. In our assessment for Kim’s husband, we found that his diabetes was not well controlled, but we also found that his blood pressure was.
The well-controlled blood pressure (which is a common condition in diabetics) actually added credits to his underwriting score. The diabetes, on the other hand, deducted credits from his underwriting score. We then had to factor in things like his age when he reinstated, age at on-set of medical conditions, body mass index, and so-on.
Using underwriting guides that are well accepted in the industry, we applied all of this medical history – good and bad – in the exact same way this insurer should have applied the information. Our final analysis showed that the denial was wrong, the insurer erred, and that the claim should be paid.
Denial Overturned. Claim Approved!
We put together our research, our references, the medical files we relied on, the basis for our conclusions and presented to the insurer. Our Appeal was thorough and our reasoning was comprehensive. To their credit the insurer reversed their decision and promptly issued a check to Kim for the claim.
Even though losing her husband was a sad event, Kim was happy to receive her money, pay the funeral home, and do a little something for herself – just as her husband had intended when he bought the policy.
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Also Read:
Suicide & Life Insurance Claims
Wrong Beneficiary Paid. What to do.
How to get a death claim paid.