Many people buy life insurance and depend on it delivering when they finally need it. But what happens when the customer runs into problems and the life insurance company becomes non-responsive or gives an answer that does not make sense? There are many areas of the law that are complicated for the general consumer to fully understand ranging from: life insurance litigation, life insurance issues, elder financial abuse, insurance bad faith, life settlements, broker and agent malpractice, denied and delayed life insurance and life insurance incontestability clauses.
We sat down with Benjamin Blakeman for a Q and A:
What are the most typical Life Insurance issues for the consumer?
The most common issue is a dispute over the beneficiary, which can arise when there is a divorce where there is a last minute change, or in a variety of other circumstances. We also have situations where a claim is denied either because a policy has lapsed, a failure to disclose medical conditions, or various other reasons.
What is your background on being a Life Insurance Law Expert?
In 1999, I took a hiatus from my law practice, and I sold life insurance for seven years. I was a compliance officer in two life insurance agencies. I was also a Registered Investment Advisor, an Investment Advisory Representative, and was series a 6, 65, 24, and 52 securities licensee. I sold over 500 life insurance policies as a life insurance agent. When I returned to my law practice, I focused on life insurance issues, and have litigated over 300 life insurance cases since 2006 and recovered over $20 million for my clients.
Why do you think there is a need for Life Insurance Litigation?
There are disputes that arise that cannot be resolved without litigation. We attempt in every case to resolve without litigation, but it is not possible in many cases.
Has the climate changed in people seeking support and help with Elder Financial Abuse?
It’s hard to say. I would like to believe that there is more public awareness of this issue, but I have not seen much evidence of it, except among lawyers.
What is the first thing someone notices with Insurance Bad Faith?
An insurance company or representative acts unreasonably with respect to a claim or an interpretation of a policy clause or rider.
What are Life Settlements?
A life settlement is the sale of an existing life insurance policy to a third person.
Are Broker and Agent Malpractice common?
Yes, but many cases either don’t get reported or are not sufficiently significant to justify legal action.
What are the common Denied and Delayed Life Insurance problems people deal with?
Lapsed policies, accidental death claims, and policies that are within the period of contestability.
What is the Life Insurance Incontestability Clause?
If an insured dies within two years of the issuance of a life insurance policy or the reinstatement of a policy, this is known as the Period of Contestability. In such cases, the life insurance company will engage in “post claims underwriting” to determine if there were any material facts misrepresented in the application, such as undisclosed medical conditions, before paying the claim. Once two years has passed, the policy becomes incontestable for all undisclosed medical issues, although there may still be challenges where it is suspected that there is an imposter situation, where there is an undisclosed purchase by a person or entity without any insurable interest.
Has the pandemic changed the way consumers encounter problems with Life Insurance?
I am not aware of any unique changes, although certainly anyone who has Covid 19 and fails to disclose it on an application would be subject to a challenge if they die within the period of contestability.
Life Insurance Law Expert, Benjamin Blakeman graduated from UCLA School of Law and has been a member of the California Bar since 1974. He was also an American Arbitration Association arbitrator from 1985 to 2008, a certified mediator from 1997 to 2008, a financial advisor from 1999 to 2008, and a life insurance agent since 1999.
For more info: www.lifeinsurance-law.com