When alcohol consumption ties into the death of the policyholder, life insurance claims can and do get denied. Many states allow life insurance companies to add exclusions to their policies when deaths result, either directly or indirectly, from alcohol use.
If the insurance company denies your claim due to alcohol-related reasons, do not give up – you can take steps to fight for the amount you rightfully deserve. Wallace Law is on your side, and our life insurance claim attorneys are ready to help you every step of the way. Do not hesitate to contact us for a free case review.
Common Reasons Life Insurance Companies Deny Claims for Alcohol
Alcohol use on its own is not typically a reason why an insurance company would deny your claim. It is when alcohol use is involved in the death of the policyholder that things get muddled. Here are a few common reasons why life insurance companies deny claims for alcohol.
Intoxication Exclusion
One primary alcohol-related reason a claim can be denied by an insurance company is if they invoke an intoxication exclusion. Intoxication exclusion refers to the general clause in a life insurance policy that prohibits claims from getting paid out if the policyholder dies while under the influence of drugs or alcohol. Insurance companies like to use this clause in their policies to reject claims, often based on alcohol being present in the deceased’s system even if the alcohol had little to do with their death.
History of Alcohol Abuse
Obtaining life insurance coverage as a recovering alcoholic is difficult, and life insurance policies tend to have higher than normal premiums for those with a history of alcohol abuse. Along with higher premiums, there are also often stricter rules about alcohol use while insured, and dying with alcohol in their system will likely result in the insurance company refusing to pay out a claim based on that reason.
Alcohol Contributed to the Person’s Death
People often confuse this reason with someone dying due to alcohol poisoning. This is not the case, and insurance companies will try to discover if there was a link between being intoxicated and the policyholder’s death.
Alcohol needs to play a central role in how the death occurred. For example, would the deceased have been in the situation that led to their death had they not been intoxicated? If the answer is no, then it is reasonable to assume that the life insurance company would conduct an investigation.
Alcohol does not directly have to kill someone for the insurance company to deny the claim. Even an indirect relation to the death is reason enough for a denial. For instance, if a person died by falling off a balcony, or getting into a car accident, and if the insurance company discovers that alcohol was the catalyst that led to the accident, the claim will likely be denied.
Can a Life Insurance Claim Be Denied for Drug Use?
Yes, life insurance claims can be denied for drug use, especially if the drug use was not disclosed upfront when obtaining the policy. Life insurance companies will examine medical records, public records, arrest records, and even social media platforms to determine if drug use had any factor in the death of the policyholder. Drug use itself does not necessarily mean an automatic denial, but if drugs are found present in the deceased’s system, you can reasonably expect the insurance company to issue a denial if their investigation warrants it.
Drugs are treated functionally the same as alcohol under an insurance policy’s intoxication exclusion. Things might be different in the case of legal prescription drugs, but in those instances, it is best to discuss with a lawyer the specifics of your case.
It does not matter what substance intoxicates the policyholder. If their intoxication leads to their death, the insurance company will likely deny your claim.
How Often Are Life Insurance Claims Denied?
Alcohol intoxication, drug use, suicide, lack of payment on the policy, and lying on an application are all the most common reasons for claims to be denied.
It is important to recognize that even in cases of alcohol intoxication or suicide, every case is unique. Insurance companies can and do make mistakes, especially in more complex cases. If your insurance claim is denied, do not give up – you can fight for your claim.
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What to Do if a Life Insurance Claim Is Denied
If your life insurance claim was denied, you have several options.
Step 1: Review Your Denial Letter
Review your denial letter thoroughly. It is surprising how many people overlook the denial letter the insurance company provides. In it, you will see the specific reasons for denying your claim.
These letters typically reference the life insurance policy’s clauses directly, which gives you more insight into why your claim was denied. This will help you prepare for your appeal.
Step 2: Collect Evidence and Gather Documents
If you feel your life insurance claim was denied unjustly, the next step before you file an appeal is to gather as much supporting evidence and documents as possible. Some key pieces of evidence to support your appeal can be:
- Medical records
- Death certificate
- The original life insurance policy and copy of the original application
- Any related accident, incident, or police reports
- Proof of insurance premium payments
- Correspondence or documents provided by the insurance company
Further, getting independent expert opinions from specialists or medical professionals can strengthen your appeal. Remember, since life insurance claim denials are rare, you can reasonably expect that the insurance company has a strong reason for their denial. This is why it is best to come prepared with as much supporting evidence as possible, especially if the denial of your claim is alcohol-related.
Step 3: Talk to a Lawyer
When filing an appeal, it is in your best interest to get professional legal assistance. A life insurance claims attorney can help you in several ways:
- We can help you gather all the necessary evidence related to your appeal.
- We will review your case and help you make the best decisions for your appeal.
- We will file your appeal on your behalf and represent your best interests.
- We can handle all communications between you and the insurance company.
- We will ensure you are not lowballed and will fight against the insurance companies that are undervaluing your claim.
After suffering the loss of a loved one, the last thing on your mind is a prolonged legal battle. By hiring a lawyer, you can eliminate the stress of battling the insurance company on your own. The law can help you fight against an unjust claim denial, and hiring a lawyer can help you maximize your chances of successfully winning your appeal.
If necessary, your lawyer can also help you file an official complaint against the insurance company with the Wisconsin Office of the Commissioner of Insurance.
How Do You Appeal a Denied Life Insurance Claim?
Most insurance companies have their processes for appeals. This process is outlined in the denial letter that is sent to you. These are the typical steps you need to follow:
- Ensure you are within the timeframe allowed by the insurance company. Most insurance companies have anywhere between a 30 to 60-day deadline to file an appeal. It is best to get started with the appeals process as quickly as you can.
- Draft a formal appeal letter. Most insurance companies will require you to provide an appeal letter to start the appeal process. When writing the letter, keep it clear and concise. Include the policy and claim information, your reason for appealing, and any context needed for the supporting documents and evidence you have attached.
- Provide evidence and supporting documents. Do not forget to make copies of your originals to send in with your letter. Try to gather as much evidence as you can because the more evidence you have, the better your chances are at a successful appeal.
Once you have followed the above steps, your lawyer will submit your appeal. Strong legal representation can help you increase your chances of filing your appeal correctly and improve your chances of recovering your claim.
Talk to an Insurance Claims Denial Lawyer for Help
Denials are not always set in stone, and if you feel that you have a case to appeal the decision, you should get help from a lawyer. Hiring legal representation can make all the difference in obtaining a successful appeal. It can be difficult to know where and how to begin with your appeal, but our lawyers here at Wallace Law are ready to assist you during this difficult time.
We have recovered millions for residents in Wisconsin. It does not matter if your insurance claim was denied due to alcohol intoxication. We review all cases for free at no risk to you.
If you do not get paid, neither do we. Our goal is to help clients face insurance companies and give them the means to properly fight for their claims. Contact us today for a free consultation.
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