Part of being in the life insurance business, neck deep as I am, is the fact that sooner or later there are claims. If a life insurance agent sells a lot of products and a few of those are life insurance policies they might retire with only a claim or two to walk clients through. If they devote all of their client base to life insurance and have thousands as I do then claims, while not frequent, aren’t an unheard of experience.

For me each one stands out for some reason or another. The first claim was a client who bought a $100,000 policy for his grandchildren (no other relatives). He just wanted to leave something behind. It was a classic contestability case in that a month after the policy went in force he was diagnosed with cancer and two months later he died. It was not only his family’s first experience with contestability, but mine as well. I knew what to expect and especially with the suddenness of the death assumed they would investigate every angle to see if he had some knowledge of the cancer prior to taking the policy out. None was ever found and after 5 months they released not just the $100,000 of life insurance, but interest on the life insurance death benefit from the day he died.

Another 40 something man who was a helicopter pilot EMT died of a heart attack not long after taking out his insurance at his wife’s insistence. She was worried that with his aviation being to rescue lives in all sorts of conditions, that the danger might soon catch up with him. The helicopter didn’t, but his heart did. I will never forget this client and his wife for how close they came to not having coverage. Because I don’t remember the actual dates I can tell you that his policy had been in force for a year and he had not paid the renewal premium. It was well into the grace period when he died and past the grace period when she contacted me. His death occurred on the last day of his grace period (as in if he died June 30 there would have been no coverage. but he died the last day of the grace period June 29). The company investigated because of the grace period and then paid in full.

So many after so many years. I had a client whose husband was a student pilot who died and the claim was paid who then referred me to a friend in Hawaii. Over the years she bought three policies on her husband and a few on herself. I knew Frank was having health issues, internal melanoma to be specific, but I’ll never forget the day his wife called and told me he had been moved to hospice. We talked about whether or not using the accelerated death benefit might help since he had not By this time we were all good friends. We talked about that inevitable day, prayed together and I let her know that I would be there to walk her through it all. Fortunately nothing was contestable and all went smoothly and she has, just as Frank planned, the money for a good retirement.

Bottom line. I have been accused of asking too many questions prior to a life insurance application, but please note that none, not one of the death claims filed for my clients has ever been successfully contested. Companies have the right to investigate and the best way to be prepared is to have answered all of the pre application questions completely and honestly. If you have questions about claims or how the contestability period works, call or email me directly. My name is Ed Hinerman. Let’s talk.

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