Avoiding insurance claim denials and life insurance pitfalls
Follow these tips when establishing a life insurance policy in order to avoid claim denials or delays of claim payments in the future.
August 20, 2013 /24-7PressRelease/ -- Avoiding insurance claim denials and life insurance pitfalls
Article provided by Brown & Gould, PLLC
Visit us at http://www.browngouldlaw.com
Insurance can make life a lot easier for many people in Oklahoma, Texas and across America. From life insurance to health care plans, providers offer coverage for almost any type of situation. Insurance policies are available for all types of losses, such as:
-Renters insurance to cover damage caused by tenants.
-Travel insurance for lost luggage or missed flights.
-Auto insurance in the event of accidents, hailstorms and damage caused by negligent motorists.
-Health care insurance for disease prevention and cures for ailments and injuries.
-Liability insurance for business losses or disputes.
Unfortunately, your insurance company does not always provide the protection you pay for. Too often, the companies to which you give your hard-earned money deny insurance claims, claiming your policy does not cover the incident, accident or loss. Not only do people have to struggle with the circumstances that harmed them, they may have to resort to litigation in order to recover their losses rightfully due from their own providers.
This can be especially common with life insurance policies. Mistakes during the creation of a policy can have devastating consequences for surviving family members. Frequently, errors are inadvertently made when the beneficiaries -- those who are designated to receive policy proceeds -- are named. These types of mistakes are common but easy to fix if taken care of prior to the policyholder's death.
Avoiding life insurance pitfalls
At the time you purchase a life insurance policy, be very careful whom you have named as the beneficiary on your policy, and follow these tips to help avoid a denial or delay with your family's receipt of life insurance proceeds.
-Naming beneficiaries: Be specific when naming who has the right to the policy proceeds. Provide legal names, addresses and other identifying information rather than using general phrases like, "my children" or "my siblings." Always provide a back-up beneficiary in the event your primary beneficiary is unwilling or unable to accept the proceeds.
-Minor children and young adults: Do not name a minor child as your beneficiary as insurance companies cannot make payments directly to minors. Think carefully about naming young adults as beneficiaries as well since many will not know how to manage a large influx of money. You may wish to have the proceeds paid out in installments via a responsible individual or a trust.
-Community property states: If you live in a community property state -- like Texas -- your spouse will have certain rights to the proceeds no matter whom you name as your beneficiary.
-Tax planning: In general, death benefits are tax-free but there are certain restrictions, including instances where the policy owner, the person insured by the policy and the beneficiary are three separate people.
-Government benefits: Naming a dependant as your beneficiary may make him or her ineligible for certain governmental benefits and assistance, such as Medicaid and Supplemental Security Income.
An insurance lawyer can help
If you have an insurance claim that has been denied or you wish to avoid future issues with insurance claims, consult an experienced insurance law attorney. A lawyer knowledgeable about bad faith denials, insurance disputes and denied claims in Oklahoma and Texas can help you understand your rights.
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