Life insurance payout in cancer related situation

[icebrew]

Hello, A relative recently passed away from breast cancer. She had cancer originally in the 90s, however the cancer came back. She had life insurance up to her passing through her employer. The Life insurance company said over the phone that they might not pay out because she had cancer before she was employed with the company and therefore before she was covered. This is in Pennsylvania. Do you have any advice/comments that can help us?

 

[DHK]

Non-Contestability Clause

Contestability Periods in Life Insurance
In the context of life insurance, contestability refers to an insurance company's right to refuse to pay out on a claim due to inaccuracies in an insurance application. Most policies maintain a window during which the insurance company can deny a claim if it finds a material falsehood in an application, whether that falsehood has anything to do with the cause of death or not. The rationale behind such a move suggests material misrepresentations on a life insurance application may cause an inaccurate premium or death benefit calculation. Most contestability periods last between one and two years after a policy goes into effect, however lapses caused by nonpayment of premiums may cause a new contestability period to begin. If an individual dies during the contestability period, the ultimate payment of a death benefit may depend upon whether or not the insurance company finds any issues with the application. Insurance companies that find material misinformation can also make adjustments to premiums or to the death benefit.

While this article says only during the first 1-2 years of a policy, with a group plan, it may be different.

 

[billyb]

I thought most group life was GI.

 

[somarco]

Group life insurance is normally GI . . . up to a limit. If you want more than the GI limit E of I is required.

Example.

GI up to 1x salary; E of I required for 2x salary (but only for the additional 1x).

How long was the woman on the group plan? What *** "adjudicated" the claim over the phone before it was submitted?

 

[VolAgent]

Submit the claim. Everything else is speculation until then. If it is denied then you can explore your options. They will have to provide a denial letter explaining exactly why it was denied. Then you could contact your state's Department of Insurance and/or a lawyer if you feel the denial violates the contract or insurance law.

 

[ATM]

It is possible they had an exclusion for pre-existing conditions on that policy

 

[somarco]

It is possible they had an exclusion for pre-existing conditions on that policy

Have you ever seen a p-x clause on a group term life insurance contract?

 

[ATM]

Have you ever seen a p-x clause on a group term life insurance contract?

I haven't but that doesn't mean there wasn't one.

 

[somarco]

I haven't but that doesn't mean there wasn't one.

I have written hundreds of GTL contracts over the years and have NEVER seen such a clause.

How many GTL contracts have you written?

I have never seen a unicorn but perhaps in your world it is possible they exist.

 

[ATM]

Have you ever personally seen an atom. a blue whale or Diego Garcia? Me neither, but that doesn't mean they don't exist.