Can the Insurnace Co. hold-up payment?

[netta]

What is the name of your state? Maryland

I am the benificary of my ex-husband's life insurance policy. He was killed in an attempted robbery. The insurance policy I have was two months away from being two years old when he was killed. The insurance company tells me they are investigating his death. I have sent them the dealth certificate, the emergency room Dr's report, the police report, the obitiuary and all papers they are requesting. They now say they want a copy of his last physcial report from his Dr. which was over 3 years ago. I have contacted the Dr. and was told that files from 3 years ago are not on their computer and are in storage. Is there anyone or any agency that governs these people who seem like they don't want to pay this policly?

 

[Dandy Don]

Of course insurance companies try to delay payment. They are going to try to look for a disease that he had that he may not have reported on his application and then try to deny payment based on a pre-existing condition. But it does not seem likely that this would apply in this particular case, since the death had nothing to do with his medical condition.

So are you going to be able to get his medical records from storage or not? If possible you need to try to get them. If they are not there, ask the doctor's office if you can possibly get them through Medical Insurance Bureau (MIB).

Just be patient--you WILL be getting a check. Too bad they put you through all the rigamarole first.

 

[FirstChance]

It will say

right in your policy that the first two years of coverage constitute the contestability period. During this period the insurance company will investigate everyone's claim to look for any possible fraud prior to policy issue as well as disqualified deaths (such as suicide or felony commission). this period and the investigations, though can be quite stressful on the beneficiary, are not personal, do not mean that the insurance company doesn't want to pay you, and are not only regulated heavily, but are required by law in most states.

you may not be one of them, but a lot of bad people have done some very disgusting things with life insurance to try to make money.

 

[ALawyer]

First, the insurance company will be obliged to pay interest on the claim until you receive the proceeds. In some states the rate is quite a bit higher than you'd earn from a bank.

Second, it is customary to investigate all deaths within the first 2 years of policy issuance. If there was a material misstatement on the application (such as if he had a heart condition and did not, or, in some states, if he was was a smoker and said he was not), such that the company would not have issued the policy on the same basis as it issued had he not made the missatement, it could deny the payment, EVEN if the cause of death had nothing to do with the misstatement.

You could, of course, always sue the company in such circumstances, and if the statement was not false or not material, or the company knew about the conditon or in some states the missatement or omission was otherwise excusable, you'd recover.

The other thing they look for is whether the beneficiary had an active role in the death, in which case the company would still have to pay, but the beneficiary would be disqualified from taking so they would someone other than the beneficiary.

One bit of advice. The company has a duty to do the investigation, NOT YOU. Depending on the state, you may not have any obligation to assist them, and in most states any obligation you do have may not extend to granting permission to look at his medical records. (In some states, if he did not grant permission on the application, or the permission is no longer in effect, the insurance company is simply out of luck. While they may delay to pressure you to granting them permission to review records they have no right to see, that can constitute bad faith -- subjecting it to punitive damages). If you have any questions, see a good lawyer sooner rather than later and before you sign any more permissions to examine records.