What are the 7 Common Reasons for Denying Your Life Insurance Claims?

Getting life insurance is a great way to safeguard your loved ones. The money received (compensation) can be used to settle debts like a mortgage, pay for funeral costs, settle student loans, or leave an inheritance.

While the chances of a life insurance claim being denied are low, you should know what can land a claim in disputed territory. You can contact a life insurance attorney for guidance and maybe to defend yourself in situations where the claim has been denied. 

In this article, we will look at some of the most common reasons for life insurance denials and how to avoid or challenge them.

1. Misrepresentations in the Policy

It is understandable for an insurer to deny a claim when policyholders make false representations on their policy applications. This is particularly true when policyholders conceal criminal histories and medical conditions. 

2. Your Policy Did Not Mention a Beneficiary

Every life insurance policy should name at least one person who will receive the monetary benefit if the policyholder passes away. This person is referred to as the beneficiary. Your insurer might deny your claim if you did not name a beneficiary on your life insurance policy. In some cases, the insurer pays the funds to the wrong person. In other cases, the death benefit will be paid to the deceased’s estate. While the deceased’s family can receive this benefit, they may be required to pay additional taxes.

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3. Missed Premium Payments

You must pay the monthly premium to keep your life insurance coverage. If you fail to make your payments (premiums), you may lose your coverage.

It is critical to understand the various grace periods that your policy may have. Grace periods differ depending on the insurance company, policy type, and applicable law in your jurisdiction. The legislation in British Columbia allows for a 30-day “grace period,” during which you can pay an overdue life insurance premium.

Sometimes beneficiaries file life insurance claims that are later rejected because they are unaware that their loved one has stopped making premium payments. Insurance companies reject such claims since the policy would not have been in effect at the time of the policyholder’s death had the premiums not been paid. As a result, to keep your insurance coverage in effect, you must continue making regular premium payments.

4. Death due to suicide

Suicide clauses are frequently included in life insurance policies, which typically last two years. If a suicide occurs during this period, the insurance company is unlikely to pay. Instead, the premiums will be refunded to the beneficiary.

5. Avoiding Medical Tests

The insurance provider verifies every medical detail filled out by the applicant, especially in cases of high age or high-risk coverage. The majority of companies conduct medical tests for the same reason. If you avoid these tests, an insurer will likely reject your claim due to a pre-existing disease. It’s always a good idea to have medical tests done so that any pre-existing illnesses can be identified and the company can provide coverage for them. Because if the medical tests have already been completed, there is less chance of rejection during the claim process.

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6. The Policyholder’s Death Occurred During the Contestability Period

A contestability period is included in the majority of life insurance policies. During this time, usually two to three years, the company reserves the right to look into the policyholder’s application for evidence of inaccuracies or fraud. The insurance company can use this time to look for evidence of misrepresentation and deny your claim. However, this is frequently a ruse. The best way to overcome this tactic is to seek the assistance of an experienced life insurance attorney.

7. Expired Term Life Insurance

A term life insurance policy expires at a certain age (usually 65). No life insurance benefits are payable if you die after the term has expired. When the term expires, you can renew the policy for another term at a higher premium or convert the policy to permanent coverage.


Life insurance claims can be denied for various reasons, including incorrect information on the application, missed premium payments, and term life insurance that has expired. You should know that you may only have a certain amount of time (according to the policy) to file an appeal. Whatever the reason, an experienced insurance lawyer will assist you in fighting for your policy rights.