While in most cases insurance claims are paid promptly and with no difficulty, it can be upsetting and financially stressful if the insurer disclaims life insurance coverage on your claim. In the event that your claim is denied, it is essential to find out precisely what grounds the insurance company has for rejecting your request for payment, and to retain legal counsel in order to protect your rights and interests. Attorneys who specialize in life insurance claims can negotiate directly with the insurance company to obtain results and ensure that you get the most favorable settlement possible. If negotiations fail to produce the desired result, your attorney can file suit in civil court to force the insurance company to defend its decision and provide evidence for its claims.
Insurance companies are designed to make profit; they do this primarily by collecting premiums on their policies. Because life insurance claims come directly out of the profit margin, many insurers are motivated to delay payment or deny it altogether, thus achieving higher profits for their shareholders and financial backers. This tendency creates an adversarial position between policyholders and insurance companies in many cases, since the rightful claimant’s desire to receive their payment is at odds with the insurance company’s desire to make money. For sizable policies, it can be cost-effective for the insurer to deny payment and wait for court proceedings which may or may not be initiated against them; this allows them to avoid payment altogether in some cases, and to delay payment in most others.
If your insurer disclaims life insurance coverage on the basis of material nondisclosure, nonpayment of premiums, or for any other reason, it is prudent to obtain the services of an attorney who specializes in these sorts of cases. Some insurance companies will offer a settlement immediately once you have demonstrated your serious intent to pursue legal action against them; others will take their chances in legal proceedings and bring their considerable financial advantage to bear in the courtroom. Regardless of which method your insurance company chooses to pursue, the services of a competent life insurance attorney can ensure that you receive the best possible resolution for your specific situation.