When you file a life insurance claim, the timing of the policyholder’s death can have a significant impact on how the insurer reviews the claim. Most life insurance policies include a “contestability period,” typically the first two years after the policy is issued. During this time, insurers have the right to scrutinize the policyholder’s application and investigate claims more thoroughly. While the contestability period is not meant to deny legitimate claims, it can lead to delays and additional paperwork. In this blog, we’ll explain what the contestability period is, how it affects life insurance claims, and what beneficiaries can do to navigate the process and ensure a successful payout.

What Is the Contestability Period?

The contestability period is a limited timeframe—usually two years—starting from the date a life insurance policy is issued. If the policyholder dies within this period, the insurance company is allowed to review the original application and verify that all information provided was accurate and complete. The goal is to prevent fraud and ensure that the insurer issued the policy based on truthful information.

It’s important to note that the contestability period doesn’t mean claims will automatically be denied. Instead, it gives the insurer the right to investigate and, if discrepancies are found, to potentially deny the claim on those grounds. Once the contestability period ends, the insurer generally cannot contest the policyholder’s statements unless there is evidence of outright fraud.

How Does the Contestability Period Affect Claims?

When a claim is filed during the contestability period, beneficiaries may face additional steps and delays, including:

1. A More Thorough Review of the Application

The insurer will carefully review the policyholder’s original application, including medical records, lifestyle disclosures, and other details. They will compare this information to the cause of death and any new information that comes to light.

2. Requests for Additional Documentation

Beneficiaries may be asked to provide additional documents, such as the policyholder’s complete medical history, statements from doctors, or other supporting records. These requests can slow down the claims process and require extra effort from the beneficiary.

3. Potential Denial for Misrepresentation

If the insurer discovers that the policyholder omitted key information or provided false statements—such as failing to disclose a pre-existing condition or understating smoking habits—they may deny the claim. The insurer’s justification would be that they issued the policy under false pretenses.

4. Delays in Payout

Even if the claim is ultimately approved, the investigation process can lead to delays in receiving the payout. This can cause financial stress for beneficiaries who are relying on the funds for final expenses, mortgage payments, or daily living costs.

What Can Beneficiaries Do During the Contestability Period?

If you find yourself navigating a life insurance claim within the contestability period, there are several steps you can take to improve your chances of a successful outcome:

1. Gather All Relevant Documentation

Start by collecting all the documents the insurer may need. This includes a certified death certificate, medical records, and any correspondence between the policyholder and the insurance company. The more prepared you are, the faster the insurer can review your claim.

2. Respond Quickly to Information Requests

If the insurer asks for additional records or clarification, respond as promptly as possible. Delays in providing requested information can prolong the claims process. Keep track of all communications and follow up regularly to ensure the insurer has everything they need.

3. Consult an Experienced Life Insurance Attorney

If your claim is denied or you encounter significant delays, consulting a life insurance attorney can be a wise move. An attorney can review the insurer’s reasoning, identify weaknesses in their case, and help you present a strong appeal. They can also ensure that the insurer is acting in good faith and not using the contestability period as a pretext to deny legitimate claims.

4. File an Appeal if Necessary

Should the insurer deny your claim, you have the right to appeal their decision. Work with your attorney to gather additional evidence, present a compelling case, and challenge the insurer’s findings. Many claims that are initially denied during the contestability period can be successfully overturned on appeal.

What Happens After the Contestability Period Ends?

Once the contestability period expires, the insurer’s ability to challenge claims based on application misstatements is greatly limited. If the policyholder dies after this period, the insurer can only deny the claim for reasons explicitly stated in the policy (such as exclusions for certain activities) or if fraud is proven. For most beneficiaries, this means a smoother and faster claims process after the two-year window closes.

It’s important to note that even after the contestability period, beneficiaries should keep detailed records and respond promptly to any insurer inquiries. While the process is generally less complicated, having organized documentation can help ensure a swift payout.

Understanding Your Rights During the Contestability Period

Filing a life insurance claim during the contestability period can involve additional scrutiny and potential challenges, but it’s important to remember that you have rights as a beneficiary. By staying organized, responding quickly to requests, and seeking legal assistance if needed, you can navigate the process and often improve your chances of receiving the benefits your loved one intended for you. If you’re facing delays or denials during the contestability period, contact the Law Offices of Jason Turchin today for a free consultation. Our experienced life insurance lawyers can guide you through the process, help you appeal denied claims, and ensure you receive the financial support you deserve.

Who Is Globe Life?

Globe Life Insurance, known for its term life, whole life, and children’s life insurance products, is a financially stable insurance provider that operates across the United States. They market primarily to families looking for straightforward life insurance options. As a company that prides itself on an easy application process and no medical exam policies, Globe Life aims to make life insurance accessible to everyone. However, like all insurers, Globe Life sometimes denies claims based on various reasons that they deem valid within the confines of the policy terms.

Common Reasons for Claim Denials by Globe Life

• Non-payment of premiums: This is one of the most straightforward reasons for a denial. If premiums are not paid on time, the policy may lapse.
• Material misrepresentation: If it is found that the insured misrepresented their health or lifestyle on their application, Globe Life may deny a claim.
• Exclusions specified in the policy: Certain deaths, such as those resulting from high-risk activities, might not be covered under the policy’s terms.

Strategies to Contest a Globe Life Insurance Claim Denial

1. Review the Denial Letter Carefully:
   Understand the specific reasons given by Globe Life for the claim denial. This letter should outline why the claim was denied and provide information on the appeals process.
2. Examine Your Policy:
   Review your policy documents closely. Understanding your coverage, exclusions, and the terms about premiums and representations made during the application will help in formulating your appeal.
3. Gather Supporting Documentation:
   Compile all relevant documentation that supports your claim or counters the reason for the denial. This may include medical records, proof of premium payments, and any correspondence with Globe Life.
4. Write a Formal Appeal Letter:
   Draft a concise and factual appeal letter to Globe Life that addresses each point of their denial. Include all supporting documents and explicitly ask for a review and reversal of the denial.
5. Seek Legal Advice:
   Consult with an attorney experienced in life insurance claims. Legal experience can be invaluable, particularly if the reasons for the denial involve complex issues like material misrepresentation or policy interpretation.
6. File a Complaint if Necessary:
   If you believe that your claim was unfairly denied, consider filing a complaint with your state’s insurance commissioner. This step can add an additional layer of review and pressure on the insurer to resolve the issue fairly.

Conclusion

Successfully overturning a life insurance claim denial from Globe Life often requires a well-prepared approach that addresses the insurer’s reasons for denial directly and robustly. At the Law Offices of Jason Turchin, we are committed to helping you understand and navigate this process, helping to ensure you receive the benefits to which you are entitled. Don’t navigate this challenging time alone; contact us for support at (954) 515-5000 or visit our website for more information and assistance.

Overview of NJ 17B:25-11

New Jersey’s life insurance statute helps ensures that claimants receive timely payouts and are adequately informed throughout the claim process. The statute details several important requirements:

1. Settlement Within 60 Days (Subsection a):
   Insurers may settle claims within 60 days after receiving due proof of death, and, if required, either the surrender of the policy or proof of the claimant’s interest, or both. This prompt settlement is supposed to help ensure that beneficiaries receive their benefits in a timely manner without unnecessary delays.
2. Notification Within 45 Days of Additional Investigation or Denial (Subsection b):
   If a claim requires further investigation or may be denied, the insurer may notify the claimant in writing within 45 days of receiving the necessary documents. This notification may explain that the claim may be under investigation or the reasons for denial, except in cases where there may be a probable cause to suspect fraud.
3. Payment of Uncontested Claims (Subsection b):
   Any uncontested portion of a claim may be paid no later than the 60th day following receipt of the necessary documents, ensuring that claimants receive at least part of their due benefits promptly.
4. Final Decision Within 90 Days (Subsection c):
   Upon receiving any additional documents or information related to a claim under investigation, insurers may either pay the benefits or deny the claim within 90 days. This provision helps to prevent prolonged investigations that can unduly delay the payment process.
5. Interest on Overdue Payments (Subsection d):
   Payments that are not made within these specified timelines may be considered overdue and will accrue interest at a rate equal to the average rate of return of the State of New Jersey Cash Management Fund for the preceding fiscal year, rounded to the nearest half percent. This interest is designed to compensate the claimant for the delay.

Implications for Policyholders and Beneficiaries

Understanding these provisions may be crucial for anyone involved in a life insurance claim in New Jersey:

• Be Prepared: Ensure that all necessary documents are submitted promptly to avoid delays in the claims process.
• Understand Your Rights: Knowing the timelines within which insurers must act can help you monitor the process and assert your rights if delays occur.
• Seek Assistance: If you experience undue delays or if your claim is denied and you believe it was unjustified, seeking legal assistance can help you address these issues effectively.

Conclusion

NJ 17B:25-11 provides a structured framework for the timely processing and payment of life insurance claims, protecting the rights of beneficiaries during a challenging time. Understanding these legal provisions can empower beneficiaries to effectively manage their claims and seek recourse if necessary. If you need help understanding the details of your life insurance claim or if you are experiencing difficulties with your claim, contact the Law Offices of Jason Turchin at (954) 515-5000. Our team is ready to provide you with the guidance and support needed to help ensure that your claim is handled fairly and promptly.