Life Insurance Denial

Dallas life insurance attorneys will tell you story after story that sounds similar to the one published in the Louisiana Record on October 2, 2014. The title of that story is, “Life Insurance Company Sued By Woman Seeking Benefits After Child’s Father Is Murdered.” Here is what the article tells us.
A woman sued a life insurance company for allegedly not paying life insurance benefits after the father of her child was shot to death.
Iviane Johnson filed suit against Globe Life & Accident Insurance Company in the Orleans Parish Civil District Court on Aug. 1.
Johnson claims on Dec. 12, 2012, she purchased a $50,000 term life policy from Globe Life designating her as the main beneficiary. The policy insured the life of Billy Ray McCormick, father of the petitioner’s minor child, which purportedly included an accidental death benefit rider in the allotted amount of $100,000.
On Aug. 27, 2013, McCormick died due to a gunshot wound in New Orleans. Johnson alleges that despite repeated requests, Globe Life has refused to tender payment of the subject life insurance policy to the main beneficiary, Iviane Johnson, which constitutes a direct violation of Louisiana law.
Iviane Johnson has a pecuniary interest in the subject life insurance policy, as she is the mother of McCormick’s only child.

This article does not tell us the reason used by the life insurance company for refusing to pay the claim. It is important to know that in Texas, a life insurance company is required by Texas law to put in writing the reason or reasons for denial of a claim. Giving the life insurance company the benefit of doubt, there are often times, legitimate reasons for denial of a claim.
However, too many times claims are denied that should be paid. Often times the reasons stated for denial are just plain false. Someone who does not understand the laws related to life insurance policies and claims would not know the difference between a claim that should be paid and a claim that is denied for good reason.
An insurance company will often times take advantage of people on policies where the insured amount is $100,000 or less. A lot of these types of policies are sold and often times, though not always, the person who purchases these lower priced policies do not have the extra money or time or knowledge to fight the insurance company when a claim is denied. This is where an experienced insurance law attorney who works on a contingency fee basis is the only option. Most law firms will not take these smaller policy cases unless they are paid a big retainer up front, thus a lot of people are kept from fighting for the claim that should be paid.
Here’s the real kicker – the insurance companies know this and know that the majority of the time they can get away with denying a claim that should have been paid simply because the only thing that will happen is that the claimant will call and bother them for a few weeks or months before finally going away.