Death does not end a family's debts, and funerals are expensive. A coffin, a plot, and the service itself run into thousands of dollars, which is exactly what a life insurance policy exists to absorb. That is the intention, anyway. Insurers are businesses, and businesses look for ways to hold on to money. If your claim has been denied or stalled, keep that in mind: the denial is a business decision, and it is one that can be challenged.
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The mechanics matter to a claim. A policyholder takes out coverage on their own life and names a beneficiary or beneficiaries, and those beneficiaries are the ones who deal with the insurer once the policyholder dies. Life insurance proceeds are not subject to probate, because a policy is a contract with the insurance company rather than an asset of the estate. That is why beneficiaries negotiate directly with the insurer instead of going through the executor.
Divorce is where a large share of beneficiary disputes begin. A final divorce decree is usually sweeping and removes a former spouse as a beneficiary under a will, but a will and a life insurance policy are not the same instrument. The decree does not erase a former spouse from the policy itself. The policyholder has to change the beneficiary designation, and when nobody does, the money can go to an ex-spouse instead of a current one. We battle insurance companies on behalf of beneficiaries and know how to get them to respond.
Life Insurance Claims
Your loved one died, and soon your realize that funerals are expensive. Somehow, death is not the end when it comes to money. It does not end your debts. For a proper burial, you have to pay thousands of dollars for a coffin, a plot, and the funeral itself. A life insurance policy takes the weight off your loved one. That is the intention, anyway. Sometimes, insurance companies sneak in ways to weasel your grieving family out of money. They are a business. Businesses look for cost-saving tactics. Keep that in mind if your insurance company denies your claim.
We at Freundlich & Littman, LLC are your life insurance claims attorneys. When your insurance company fails your family, we are here to help you pick up the pieces. We battle insurance companies for our clients. We know how to get them to respond to property insurance claims. Death is hard. Collecting on a life insurance policy should not.
The Process Of Life Insurance
A policyholder (the deceased) takes out a life insurance policy for themselves. On the policy, they must name a beneficiary or beneficiaries. Those beneficiaries handle the life insurance policies once the policyholder passes away.
Life insurance policies are not subject to probate. Probate is the process by which a court determines the estate of a deceased. The law determined that life insurance policyholders formed a contract with the insurance company. Contracts are not subject to probate. This is why beneficiaries deal with insurance companies rather than executors of an estate.
Divorce & Life Insurance
A final divorce decree is usually sweeping. This means that a decree removes a former spouse as a beneficiary of a will. A will is not the same as a life insurance policy. A policyholder must remove their previous spouse from their policy. A divorce decree does not erase a spouse. Remember to change your beneficiary or your old spouse could receive the money instead of a current spouse.
