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Why Might A Life Insurance Claim Not Be Paid Out?

Although there aren’t many instances that life insurers are refusing the life insurance claim, it’s important to know what could make a claim disputed. In this post, we’ve described some of the primary reasons why claims could, unfortunately be rejected.

Not disclosing medical conditions and Lifestyle Information

When you buy life insurance it is essential to provide medical conditions as well as other risk factors. If you don’t provide exact information in the application procedure, any claim made on your life insurance policy might be denied in the future.

In the event of a failure to disclose certain information while purchasing the life insurance policy can be considered to be a fraud. This could result in a inaccurate or inaccurate statement(s) or denial of details. In some instances the misrepresentation may mean that the policy was issued that could have been rejected otherwise.

The majority of policies have the clause of contestability (usually between two and three years) where the insurance company can require additional information about the cause of death. This could be in the form of medical or post-mortem documents to enable the insurance company to determine if any information was withheld in the application procedure. If the insurer discovers an indication of misrepresentation, your policy may be cancelled and your beneficiary could not be able to receive the death benefit. Keep in mind the fact that insurers have a variety of options to check the information you supply in an application.

What type of information will insurance companies demand to provide in a life insurance application?

Remember: You must receive an original copy of every application to purchase life insurance direct from the company (or the providers). It’s crucial to go over the application’s summary and notify the insurance company immediately in the event that you discover any information that is inaccurate or insufficient. Be sure to review your questions and answers to your application in order for you spot any mistakes before it’s too to late!

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The risk of not living out a “Term” Life Insurance Policy

If you’re a holder of the term insurance for life, it may possibly outlive the policy’s duration and there could not be a death benefit payout.

If you require a longer period of coverage and the insurance company may allow you to renew your policy (at the cost of a higher price) after you reach the end of your term. It is also possible to change a term life insurance policy into a whole-of-life insurance policy with a certain time period to do this. You should be aware of the dates and conditions of your policy should you be interested in changing it.

Suicide as a method of death

Life insurance policies generally come with the’suicide clause’. It typically lasts anywhere between twelve and twenty-four months dependent on the insurance company. If a suicide happens within this period the insurer usually won’t pay an award (please look through your Key Features Document of your preferred insurer for further details on this).

Making an Life Insurance Claim

In order to ensure a smooth claim process, you must inform your family members that you have an insurance policy for life and where it can be found in the event of a claim. It’s best to save the policy alongside other papers that your beneficiaries will require, and keep in mind when you manage your estate. A well-organized estate can go a long way.

If you find you have a denied life insurance claim contact the team at Resolute Claims for help…

Being in the Know

It’s important to know the differences between two types of life insurance. These are the ‘term’ type of life insurance as well as “whole-oflife” insurance.

Life insurance policies referred to as ‘Term’ are valid for a specific time period (known as the “term” of the policy) for example. 10, 15, or 25 years. They only will pay out if you happen to pass away during the term that the insurance policy. There’s no lump sum that you can pay at the conclusion of the term.

Of course the policies are generally more costly than traditional insurance policies because the length of time you continue paying your premiums, the insurance company will continue to pay you, whereas you might not live to the end of a life insurance plan.

TIP A: Whole-of life insurance is known as life insurance by several insurance companies.

One of the major advantages of whole-of life insurance is that it will aid your family in tackling the costs that are related to inheritance taxes. It could also be appealing to those who are planning to leave a certain type of inheritance to loved ones or assist with funeral expenses.