Life Insurance Lawyer Michigan
Although current Michigan state laws and legislature protect policy holders and beneficiaries from wrongdoing by their insurance company, some instances of bad faith or breaches of contract will still occur. The truth is that an insurance company is likely to make more money (in the short run, at least) by denying as many policies as possible. Using such strategies as retroactively cancelling policies due to "material misrepresentation" (relevant information missing from an application, such as tobacco usage), a company may avoid paying out on a policy which otherwise might have been valid.
Our highly-experienced life insurance lawyers live and work in Lansing, Michigan, and are passionate about protecting the rights of individuals who have been wronged by these companies. We consider that the insurance company has an obligation to you, a beneficiary, to pay the claim that was promised in the policy. Our top life insurance attorneys will fight to uphold that obligation.
A denial of your policy may leave you with financial hardships for the rest of your life. A delayed policy will leave you left wanting at present and wondering if you will ever get the payment you were promised. Sometimes, taking legal action is the only thing you can do. We offer a free case evaluation to see how we can help you. When you work with one of our attorneys, you will work with a professional who has experience and who cares about the outcome of your case. We usually recover the full amount of the policy for our clients.
Michigan Life Insurance Law
When an insurance company engages in bad faith decision making, the only real recourse left to a policyholder is to pursue insurance bad faith litigation against the insurance company. Insurance bad faith occurs when an insurance company unreasonably fails to fully and fairly pay claims promptly.
Often, clients turn to us for help when their claims have been mishandled by the insurance company. Unfortunately, cases where carriers review the insured's life insurance application in bad faith are not rare. An experienced Michigan life insurance lawyer understands the intricacies of the state bad faith life insurance law. Under the Sixth Circuit law, an insured may recover damages for an insurer's bad faith only upon a showing that the insurer committed some intentional wrongful conduct. [i] An action for bad faith requires more than mere negligence. The term itself implies some intentional wrongful conduct. Mere errors in judgment should not be sufficient to establish bad faith.[ii] Mere negligent conduct will not support a bad faith action. Liability for bad faith will arise only in those instances where an insurer acts with some degree of conscious wrongdoing, recklessness or in a manner which reveals an unjustified gamble at the stake of the insured.[iii]
Michigan law states that if payment is not made to a claimant (including a third party tort claimant) within 60 days of satisfactory proof of loss being submitted on a claim that is not reasonably in dispute and on which the insurer has refused payment in bad faith, the insurer can be assessed a high interest rate. Both a lack of a reasonable dispute and bad faith are required.[iv]
Michigan law places the burden of proving an insurer's lack of good faith in handling claims on the insured.[v] There is an implied duty of good faith and fair dealing in the handling of insurance claims. A finding of bad faith can be made when there is evidence that an insurance company made a decision that is not based on the totality of the circumstances or one that is arbitrary or capricious. The issue of the company's good or bad faith is primarily a question of fact requiring an examination of the carrier's intent or state of mind. If your claim for death benefits has been denied in bad faith, you need a skilled Michigan lawyer who will fight for your interests.
A plaintiff must establish three elements to succeed on a bad-faith claim: (1) the insurer must be obligated to pay the claim under the terms of the policy; (2) the insurer must lack a reasonable basis in law or fact for denying the claim; and (3) it must be shown that the insurer either knew there was no reasonable basis for denying the claim or acted with reckless disregard for whether such a basis existed.[vi]
When a beneficiary alleges bad faith insurance practice, it is imperative to conduct a proper analysis of specific facts and issues pertinent to a specific life insurance claim and policy. If your insurance company denies your valid life insurance claim you will need experienced life insurance attorneys to analyze your denied claim and advise you of any recourse you may have, including insurance bad faith litigation.
An insurance policy is a contract between the insured and the insurer. Insurance bad faith is a breach of that contract. There are many reasons why insurance bad faith is particularly egregious. Consequently, when insurance companies engage in bad faith, they can sometimes be compelled to pay punitive damages for their conduct.
At Insurance Claim Law Firm, we have won numerous multimillion-dollar settlements for victims of insurance bad faith, including cases involving:
- Failure to pay valid disability claims, property damage claims, and business insurance claims
- Failure to defend against lawsuits (failure to indemnify as required in business policies)
- Failure to settle within the stated policy limits
- Insurance agent or broker negligence
Our experienced trial attorneys have prevailed in cases involving life insurance, homeowners insurance and general commercial liability insurance. We have achieved numerous multi-million dollar verdicts and settlements for doctors, lawyers and other professionals who were wrongfully denied the benefits of their private disability insurance policies.
Denied or Delayed Life Insurance Claims
Despite being regulated by the Michigan Department of Insurance, these companies put profits over honoring contracts. If you have been wrongfully denied benefits for a life insurance policy, we will represent all persons involved in a life insurance benefits lawsuit on a contingency basis, meaning there will be no legal fees unless we win the insurance proceeds in your case. The life insurance lawyers handling life insurance benefits denial cases at Michigan Life Insurance Lawyers pride themselves in offering superior legal representation for beneficiaries whose claims have been denied by large insurance companies. Our focus on life insurance law and vast experience in this area sets us apart from other law firms. Our Michigan Life Insurance Lawyers are providing free case review to persons who have been denied life insurance claims or death benefits for any reason.
Michigan Life Insurance Lawsuits
Usually, life insurance claims are denied based on misrepresentations on the policy. However, under Michigan law, only material misrepresentations can be the basis for a claim denial. A material misrepresentation need not specifically relate to the cause of an insured's death for an insurance company to be entitled to the rescission or avoidance of a life insurance policy.[vii] Whether an insurer determines to enter into a contract is affected by its assessment of the likelihood of a particular fact increasing the chances of the loss insured against. Thus, an insurance policy may be cancelled for an untrue statement made in good faith or even in ignorance of its falsity, only if such misrepresentation materially affected assumption of risk by the insurer. The insurance company will need to prove that the omission or misrepresentation on the application bore a direct relation to the insurer's acceptance of the risk.
If you have been denied life insurance benefits, you may be eligible to file a life insurance lawsuit. Our Michigan Life Insurance Lawyers are handling life insurance claims lawsuits throughout Michigan and are offering free, no-obligation life insurance lawsuit case review. Call us now to discuss your individual life insurance claim denial with you in detail and answer your questions as definitively as possible.
Life Insurance Claims Lawsuits may be the Only Way to Receive Rightful Death Benefits
Many beneficiaries to a life insurance claim try to handle claim without the help of an attorney. Unfortunately, at some point many of them become worn down by efforts to communicate with the insurance agency that demands myriad forms of documentation. Many of our clients turn to us for help when they become overwhelmed by the challenge of obtaining their fair life insurance settlement.
Rescission of a life insurance policy
Unfortunately, efforts to deny death benefits have become routine for insurance agencies. It is clear that denying claims for insurers is a profitable business. Avoiding life insurance benefits lawsuits and paying fewer life insurance claims yields greater profit for an insurance company. Often insurance companies offer settlements that are much less than what they owe the beneficiaries. Not surprisingly, life insurance companies actively discourage beneficiaries from filing life insurance lawsuits.
Americans buy life insurance as a means of providing financial security for their spouse or family after their own death. An applicant for life insurance completes a long application with a life insurance agent. Then the company assesses the risk and chooses whether to underwrite the new client. If the company chooses to take on the risk, the individual begins paying premiums and becomes a policyholder.
Each life insurance policy has specific stipulations for the type of coverage and amount of the life insurance benefits. Given the regular and timely payment of life insurance premiums, consumers assume that a life insurance policy will provide for their loved ones when the time comes.
Life insurance rescission cancels the policy as though it never existed, denying life insurance benefits to family members. Life insurance rescission is a term used in legal settings and by life insurance companies to describe the cancellation, reversal, or undoing, of a contract establishing life insurance. In other words, when an insurance company rescinds a life insurance policy, an existing life insurance policy is effectively cancelled denying death benefits to beneficiaries. In many cases, beneficiaries learn they have been denied death benefits through life insurance rescission only after their loved one has died.
Laws allowing for life insurance rescission were intended to protect insurers from applicants who made false or fraudulent claims. The numbers of people receiving a letter denying death benefits grows. It seems that life insurance companies are using the typical two-year life insurance rescission period to cancel life insurance policies rather than evaluating risk carefully ahead of time. More and more life insurance rescission lawsuits are filed every year indicating that many people are facing life insurance rescission decisions and denials of death benefits that can only be reversed by a court.
Many insurers are careless in their underwriting procedures and use rescission to deny life insurance claims after the insurance holder has died and a claim has been made. Instead of making a careful assessment of a potential policy holder's risk before choosing to underwrite the new policy some life insurance companies are finding or even fabricating reasons for rescission as a way to deny life insurance benefits.
Accepting a policyholder's premiums for months or years enables life insurance companies to make potentially profitable investments. By rescinding the life insurance policy or deeming the life insurance policy null and void, critics argue, the company retains the profits and does not have to make any life insurance benefits payments to the survivors.
A life insurance company may rescind life insurance policies and deny death benefits based on claims the deceased policyholder either concealed information about a preexisting medical condition or that the death was by suicide. Life insurance companies often ignore autopsy results, made false assertions regarding suicide, illicit drug use, fabricated medical diagnoses or exaggerated the severity of a pre-existing medical problem.
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Curry v. Fireman's Fund Ins. Co., 784 S.W.2d 176 (Ky.1989) (resurrecting the tort of bad faith as a viable cause of action).
Blue Cross & Blue Shield of Kentucky, Inc. v. Whitaker, 687 S.W.2d 557, (Ky. Ct. App. 1985).
Matt v. Liberty Mut. Ins. Co., 798 F. Supp. 429 (W.D. Ky. 1991).
Mich. Comp. Laws §500.2006(4).
Hoskins v. Aetna Life Insurance Co., 6 Ohio St. 3d 272 (1983).
Wittmer v. Jones, 864 S.W. 2d 885 (Ky. 1993).
Wichersham v. John Hancock Mut. Life Ins. Co., 413 Mich, 57 (Mich. 1982).
Authored by: Laura Elmer