Life Insurance Claim Denied In Canada

If your life insurance claim was denied, you may still have options. A denial does not always mean the insurance company is right.

At Samfiru Tumarkin LLP, our insurance claim lawyers help beneficiaries, families, estates, and policyholders across Canada challenge denied life insurance claims, delayed payments, misrepresentation allegations, beneficiary disputes, accidental death denials, and mortgage life insurance claim denials.

Life insurance is supposed to provide financial support after someone dies. When an insurer refuses to pay, families can be left without money they were counting on for mortgage payments, funeral costs, debts, childcare, income replacement, or estate obligations.

Can A Life Insurance Claim Be Denied?

Yes. A life insurance company can deny a claim if it believes the policy does not have to pay.

However, the insurer must have a valid reason based on the policy, application, medical records, premium history, cause of death, beneficiary designation, or other evidence.

A denied claim can often be challenged if the insurer relied on incomplete records, misunderstood the policy, applied an exclusion unfairly, or made assumptions about the deceased person’s health, application answers, or cause of death.

Why Life Insurance Claims Are Denied

Life insurance claims can be denied for many reasons. Some denials are valid, but many can be challenged.

Common reasons life insurance claims are denied include:

• The insurer says there was misrepresentation on the application
• The insurer says important medical information was not disclosed
• The insurer says the policy lapsed before death
• The insurer says premiums were missed
• The insurer says an exclusion applies
• The insurer says death happened during the contestability period
• The insurer relies on a suicide exclusion
• The insurer disputes the cause of death
• The insurer says the claim documents are incomplete
• There is a dispute over the proper beneficiary
• The insurer says the policy was not active
• The insurer says the claim was filed late

The denial letter should explain the insurer’s position. However, the reason listed in the letter is not always legally correct.

Life Insurance Claim Denied For Misrepresentation Or Non-Disclosure

Misrepresentation and non-disclosure are among the most common reasons life insurance companies deny claims.

This usually means the insurer believes the deceased person gave incorrect, incomplete, or misleading information when applying for life insurance.

The insurer may review answers about:

• Medical history
• Past symptoms or investigations
• Doctor visits
• Medication use
• Smoking, alcohol, or substance use
• Mental health history
• Family medical history
• Employment or income information
• Travel, sports, or high-risk activities

A misrepresentation allegation does not automatically mean the insurer can deny the claim. The wording of the application question, what the insured person knew, what was disclosed, whether the information was material, and how the insurer handled the application can all matter.

If your life insurance claim was denied for misrepresentation or non-disclosure, speak with a lawyer before accepting the insurer’s decision.

Life Insurance Claim Denied During The Contestability Period

Life insurance claims are often reviewed more closely when the insured person dies soon after the policy starts.

This is commonly called the contestability period. During this period, the insurer may investigate the original application, medical records, and other evidence before deciding whether to pay.

A denial during the contestability period often involves allegations of misrepresentation, non-disclosure, incomplete answers, or medical information the insurer says should have been provided.

Families should not assume the insurer is right simply because the death happened soon after the policy was issued. A lawyer can review whether the denial is supported by the policy and the evidence.

Life Insurance Claim Denied Because The Policy Lapsed

A life insurance company may deny a claim by saying the policy lapsed before death because premiums were not paid.

Policy lapse disputes can involve:

• Whether premiums were actually missed
• Whether the insurer gave proper notice
• Whether there was a grace period
• Whether automatic payments failed
• Whether the policy was reinstated
• Whether the policyholder, employer, bank, or group plan administrator made an error

If the insurer says the policy lapsed, do not assume the claim is over. A lawyer can review payment records, notices, policy terms, bank records, and communication history.

Life Insurance Claim Denied Because Of A Policy Exclusion

Some life insurance policies contain exclusions that limit when the insurer must pay.

An insurer may rely on an exclusion involving suicide, dangerous activities, travel, aviation, war, criminal activity, drug or alcohol use, or other circumstances listed in the policy.

Exclusion disputes can involve:

• Whether the exclusion is actually in the policy
• Whether the insurer is interpreting it correctly
• Whether the exclusion applies to the facts
• Whether the exclusion was clearly disclosed
• Whether the insurer has enough evidence to rely on it

A denial based on an exclusion can often be challenged if the insurer is stretching the policy wording or relying on incomplete facts.

Life Insurance Claim Denied After Suicide

Some life insurance policies include a suicide exclusion for a specific period after the policy begins.

If the insured person dies by suicide during that period, the insurer may deny the claim or limit payment depending on the policy wording.

These cases are deeply difficult for families. They can also involve complex questions about the policy date, reinstatement, medical history, cause of death, and whether the insurer is applying the correct wording.

If a life insurance claim was denied after suicide, speak with a lawyer before accepting the denial.

Life Insurance Claim Delayed Or Under Investigation

Not every life insurance dispute starts with a formal denial. Some claims are delayed for weeks or months while the insurer investigates.

The insurer may ask for:

• Medical records
• Proof of death
• Physician statements
• Coroner or autopsy records
• Police reports
• The original insurance application
• Beneficiary information
• Estate documents
• Premium payment records

Some investigation may be reasonable, especially if the death happened soon after the policy was issued. However, unreasonable delay can create serious financial hardship.

A lawyer can help if the insurer keeps asking for more documents, refuses to make a decision, or appears to be building a case to deny the claim.

Life Insurance Beneficiary Disputes

A life insurance claim may be delayed or disputed if there is disagreement about who should receive the payout.

Beneficiary disputes can happen when:

• More than one person claims the benefit
• A beneficiary designation is outdated or unclear
• A former spouse, current spouse, child, dependent, or estate disagrees over entitlement
• The policyholder tried to change the beneficiary before death
• There are allegations of capacity issues or undue influence
• The insurer pays the money into court because of competing claims

A lawyer can review the policy, beneficiary designation, estate documents, separation agreement, divorce order, and other evidence to help determine who may be entitled to the proceeds.

Accidental Death Insurance Claim Denied

Some life insurance policies include accidental death coverage. Others are separate accidental death and dismemberment policies.

An accidental death claim may be denied if the insurer argues that the death was not accidental, that a policy exclusion applies, or that another medical condition caused or contributed to the death.

These claims can involve disputes over:

• Cause of death
• Medical records
• Toxicology reports
• Police reports
• Coroner or autopsy reports
• Policy exclusions
• Whether the accident directly caused the death

If an accidental death insurance claim was denied, a lawyer can review the evidence and challenge the insurer’s interpretation.

Mortgage Life Insurance Claim Denied

Mortgage life insurance is often sold through a bank, credit union, lender, or mortgage provider. It is usually meant to pay off or reduce the mortgage if the insured borrower dies.

Mortgage life insurance claims may be denied because of misrepresentation, medical non-disclosure, eligibility issues, post-claim underwriting, exclusions, or disputes over whether coverage was active.

Families are often surprised by these denials because they believed the mortgage was protected.

Group Life Insurance Claim Denied

Some life insurance coverage is provided through an employer, union, association, or group benefits plan.

Group life insurance claims may be denied because of eligibility issues, coverage limits, employment status, conversion rights, missed premium payments, late enrolment, or disputes about whether coverage was active when the person died.

These claims may involve the insurer, employer, benefits administrator, plan sponsor, or another third party.

A lawyer can review the group benefits booklet, master policy, employment records, enrolment forms, and communication history to determine whether the denial can be challenged.

What To Do If Your Life Insurance Claim Is Denied

If your life insurance claim is denied, take these steps before accepting the insurer’s decision:

1. Read the denial letter carefully. Identify the exact reason the insurer gave for refusing payment.
2. Find the full policy. Do not rely only on a brochure, certificate, benefits booklet, or summary.
3. Collect the insurance application. Application answers are critical in misrepresentation and contestability disputes.
4. Keep all medical and claim records. Save medical records, proof of death, claim forms, emails, letters, and call notes.
5. Gather payment records. Premium history and bank records may matter if the insurer says the policy lapsed.
6. Do not sign a release. Avoid accepting a reduced payment or settlement without legal advice.
7. Watch the deadlines. Internal appeal deadlines and legal limitation periods may apply.
8. Speak with a life insurance claim lawyer. A lawyer can assess whether the denial can be challenged.

Should You Appeal A Denied Life Insurance Claim?

Some life insurance companies offer an internal appeal or complaint process after denying a claim.

An internal appeal may help in some cases, but it is not always the best strategy. Sending the same documents again may not change the outcome, and an internal appeal may not stop legal deadlines from running.

Before appealing, consider:

• Why the insurer denied the claim
• Whether the insurer relied on the correct policy wording
• Whether the insurer has the full medical record
• Whether the application questions were clear
• Whether the alleged misrepresentation was material
• Whether the policy was actually active
• Whether more evidence is needed
• Whether legal action may be more effective than another internal review

A life insurance claim lawyer can help you decide whether to appeal, negotiate, complain, or start legal action.

Can You Complain About A Denied Life Insurance Claim?

You may be able to use the insurer’s internal complaint process or contact an external complaint body after receiving the insurer’s final position.

A complaint process may help in some cases, but it is not the same as a lawsuit. It may not result in full compensation, and it may not stop a legal deadline from running.

Before relying on a complaint process, speak with a lawyer so you understand whether a legal claim is also needed.

How A Life Insurance Claim Lawyer Can Help

A life insurance claim lawyer can review the insurer’s decision and help you understand whether the denial can be challenged.

A lawyer can help by:

• Reviewing the denial letter
• Analyzing the life insurance policy
• Reviewing the application and underwriting file
• Comparing the insurer’s position with the medical records
• Responding to misrepresentation or non-disclosure allegations
• Assessing whether a lapse, exclusion, or contestability argument is valid
• Dealing directly with the insurance company
• Negotiating payment of the claim
• Starting legal action if the insurer refuses to pay

Insurance companies do not have the final word. If the denial is unfair, incomplete, or legally unsupported, you may be able to fight back.

Life Insurance Companies We Deal With

Denied life insurance claims can involve major insurers, banks, credit unions, employers, group benefit providers, mortgage lenders, and claims administrators.

The name of the insurer matters, but the key issues are usually the policy wording, application answers, medical evidence, denial reason, premium history, and beneficiary information.

Claims may involve individual life insurance, group life insurance, accidental death insurance, mortgage life insurance, creditor insurance, or employer benefit plans.

Frequently Asked Questions About Denied Life Insurance Claims

What should I do if my life insurance claim was denied?

Read the denial letter, collect the full policy and application, keep all medical and claim records, and speak with a life insurance claim lawyer before accepting the insurer’s decision.

Why would a life insurance claim be denied?

A life insurance claim may be denied because of misrepresentation, non-disclosure, policy lapse, missed premiums, exclusions, contestability issues, suicide exclusions, beneficiary disputes, or incomplete claim documents.

Can a life insurance claim denied for misrepresentation be challenged?

Yes. Misrepresentation disputes depend on the application questions, medical records, what the insured person knew, what was disclosed, and whether the information was material to the insurer’s decision.

What is the contestability period in life insurance?

The contestability period is the early period after a life insurance policy starts when the insurer may more closely investigate the application if a claim is made. Denials during this period often involve alleged misrepresentation or non-disclosure.

Can a life insurance company deny a claim after the policyholder dies?

Yes. A life insurance company can deny a claim after death if it believes the policy does not require payment. However, the denial can often be reviewed and challenged.

Can a life insurance claim be denied because of missed payments?

Yes. An insurer may deny a claim by saying the policy lapsed because premiums were missed. A lawyer can review whether the policy actually lapsed and whether the insurer followed the proper process.

Can a beneficiary dispute delay a life insurance payout?

Yes. If more than one person claims the benefit, or if there are questions about the beneficiary designation, the insurer may delay payment or require the dispute to be resolved before paying the proceeds.

Can an accidental death insurance claim be denied?

Yes. Accidental death claims may be denied if the insurer disputes the cause of death, relies on an exclusion, or says a medical condition caused or contributed to the death.

Should I appeal a denied life insurance claim myself?

You can, but it is risky to appeal without understanding the policy, evidence, and legal deadlines. Speak with a lawyer before sending an appeal or accepting the denial.

Do life insurance claim lawyers help across Canada?

Yes. Samfiru Tumarkin LLP helps clients across Canada with denied and disputed life insurance claims.

Speak With A Life Insurance Claim Lawyer

If your life insurance claim was denied, delayed, or disputed, speak with a life insurance claim lawyer at Samfiru Tumarkin LLP.

Our team can review the denial letter, explain your options, and help you challenge the insurance company’s decision.