North Carolina General Statutes Chapter 58 governs life insurance in the state. North Carolina requires insurers to follow proper notice and grace period procedures before declaring a policy lapsed for non-payment. If a claim is not settled within 30 days after all required documents are submitted, the account begins to accrue interest under North Carolina General Statute 58-58-110. If your claim has been denied due to lapse, learn more here.

North Carolina Misrepresentation Standard

North Carolina law requires that a misrepresentation be material to the risk in order to void a life insurance policy. The insurer must demonstrate that the alleged misrepresentation would have affected its underwriting decision. Innocent errors and inaccuracies unrelated to the insured's cause of death present significant challenges for insurers attempting to deny on misrepresentation grounds under North Carolina law.

North Carolina Divorce and Life Insurance — NO Automatic Revocation

North Carolina does NOT have an automatic revocation upon divorce statute for life insurance policies. A divorce in North Carolina does not automatically remove an ex-spouse as a life insurance beneficiary. The ex-spouse named on the policy continues to be entitled to the death benefit unless the policyholder takes affirmative steps to change the designation.

 This means that in North Carolina, ex-spouses frequently collect life insurance benefits after divorce — even when the policyholder may have intended to change the designation. For current spouses and children who believe this result is unjust, legal options may be available depending on the specific facts, including divorce decree provisions that obligate a party to maintain or change beneficiary designations.