Life Insurance Beneficiary Rights: What You Should Know if an Insurance Company Denied Your Claim

When a loved one dies, the last thing a beneficiary expects is a fight with a life insurance company. Yet thousands of beneficiaries experience delayed, underpaid, or wrongfully denied life insurance claims every year. Many beneficiaries do not realize that they have strong legal rights — including the right to policy information, the right to explanations for delays or denials, and the right to review the documents used to deny their claim.

After representing countless clients in denied and delayed life insurance cases, our attorneys created this comprehensive guide to help beneficiaries understand what the law entitles them to and how to protect themselves when an insurance company refuses to pay. If your life insurance claim was denied, delayed, or you simply don’t understand your rights, this article will walk you through the essential protections you may not know you have.

1. Beneficiaries Have the Right to Know the Policy Amount

Many beneficiaries are shocked to learn that life insurance companies often refuse to voluntarily disclose the policy amount — even after the insured has passed away. The truth is:

After the insured dies, the beneficiary has a legal right to know the full value of the life insurance policy.

This is especially important when:

• The beneficiary is a distant relative or friend

• The insured never discussed the policy

• The policy was employer-sponsored

• The beneficiary did not know they were named

If the insurance company refuses to disclose the benefit amount, beneficiaries should send a written request to both the insurer and, if applicable, the employer’s benefits administrator. A life insurance lawyer can also demand this information on your behalf.

2. Beneficiaries Have the Right to Know How to File a Claim

Most beneficiaries file only one life insurance claim in their lifetime. They don’t know:

• How to complete the claim forms

• What documents to attach

• Where to send the claim

• How long the process should take

Insurance companies are legally required to explain the claims process clearly. This includes:

• Mailing or emailing claim forms

• Telling the beneficiary what documents are needed

• Explaining deadlines

• Providing instructions for submission

• Describing the review process

If the insurer fails to provide this information, the beneficiary should request written instructions or contact a life insurance attorney for guidance.

3. Beneficiaries Have the Right to Know Why a Claim Is Delayed

A typical life insurance claim should be processed in 30 days. When a claim is delayed, the insurance company must explain why and how long the delay will last. Delays often occur because:

• The insured died during the contestability period (first two years of the policy)

• The death is under police investigation

• The insurer is reviewing medical records

• The employer failed to submit required documents

• The insurer is investigating alleged misrepresentation

Regardless of the reason, beneficiaries have the right to clear, timely updates. If the insurer refuses to explain the delay, a life insurance lawyer can pressure the company to comply.

4. Beneficiaries Have the Right to Know Why a Claim Was Denied

One of the biggest frustrations we see is that beneficiaries often receive vague or incomplete denial letters. Some letters simply state:

“Your claim is denied. The benefit is not payable.”

This is not acceptable. Legally, a denial letter must clearly explain:

• The exact reason for denial

• The evidence the insurer relied upon

• Any state law or policy provision applied

• How to appeal

• The deadline for appeal

For example, if an insurer denies a claim because the beneficiary is an ex-spouse, the letter must explain:

• The specific “revocation-on-divorce” statute

• Whether the policy is governed by state law or ERISA

• Whether any exceptions apply

Many denials are overturned simply because the insurer misapplied the law.

5. Beneficiaries Have the Right to Examine All Documents Used to Deny the Claim

A beneficiary is entitled to see every document the insurer used to reach its decision. This includes:

• Autopsy report

• Toxicology report

• Medical examiner findings

• Police reports

• Pharmacy records

• Paramedic reports

• Internal insurance guidelines

• Expert opinions relied upon by the insurer

Without access to these documents, beneficiaries cannot determine whether the denial is valid. Reviewing these records is often the key to overturning a wrongful denial.

For example, a denied accidental death claim involving alleged drug use requires reviewing toxicology results, medical records, and policy exclusions. Beneficiaries cannot appeal effectively without this information.

6. Beneficiaries Have the Right to Know How to Appeal a Denial

If your claim was denied, you have the right to a full and fair appeal. The procedure depends on whether the policy is governed by state law or ERISA.

ERISA (Employer-Sponsored Policies)

Under federal law, the denial letter must include:

• Step-by-step appeal instructions

• The deadline to file an appeal (usually 60 or 180 days)

• Where to send your appeal

• What additional evidence you can submit

ERISA appeals are extremely strict. If a beneficiary fails to include critical evidence during the administrative appeal, they may be barred from presenting it later in court. This is why working with a life insurance attorney is essential.

Individual (Non-ERISA) Policies

Appeals are governed by state insurance law and are more flexible — but beneficiaries still need a strong, evidence-based appeal.

Our attorneys routinely overturn denials involving:

• Misrepresentation

• Missing evidence of insurability

• Employer negligence

• Beneficiary disputes

• Contestability issues

7. Beneficiaries Have the Right to Be Informed of Their Designation

Do beneficiaries have a right to be notified they were named on a policy?

Yes — after the insured dies.

Insurance companies are legally obligated to:

• Search for beneficiaries

• Notify them they are entitled to a payout

• Release funds accordingly

Many insurers have been sued for failing to contact beneficiaries and keeping millions in unclaimed benefits. If you recently learned you were a beneficiary years after the insured passed away, you may still have the right to collect the full payout with interest.

8. Beneficiaries Have the Right to Know How Much Interest Will Be Paid

When a life insurance claim is delayed — even for valid reasons — the insurer must pay interest on the claim. The amount depends on:

• State law

• Policy language

• How long the claim was delayed

• Whether the insurer acted in bad faith

Many beneficiaries never receive interest simply because they don’t know to ask. You have the right to request:

• The interest rate used

• The date interest began accruing

• The method of calculation

Interest can add thousands of dollars to a payout.

You Have More Rights Than You Realize — Don’t Let the Insurance Company Take Advantage

Life insurance beneficiaries have strong legal protections designed to prevent insurers from avoiding legitimate payouts. Whether your claim has been denied, delayed, or you simply need clarity about your rights, an experienced life insurance attorney can help you navigate the process and enforce the laws designed to protect you.

At our life insurance law firm, we have successfully recovered millions for beneficiaries who were initially denied. We fight insurance companies aggressively — and we don’t get paid unless you win.

📞 Call (888) 510-2212 for a free consultation.
We will review your denial letter, obtain your claim file, and determine the fastest path to getting your benefits paid.