When a loved one dies, beneficiaries often expect the life insurance policy to provide financial support quickly and without complications. Unfortunately, many Florida families are shocked to learn that the insurance company is “reviewing the claim” because the death occurred during the policy’s contestability period.
This review process can delay payment for weeks or months — and in some cases, the insurer may deny the claim entirely.
But does the insurance company automatically have the right to deny coverage during the contestability period? The answer is no.
In Florida, life insurance companies can investigate claims that arise during the contestability period, but they still must follow the law and prove a valid basis for denying benefits.
Below, we explain how the contestability period works, why insurers deny claims, and what Florida beneficiaries should know if a claim is being challenged.
What Is the Contestability Period?
The contestability period is a limited window of time — usually the first two years after a life insurance policy is issued — during which the insurance company can investigate whether the insured made material misrepresentations on the application.
This does not mean the policy is invalid during those two years. The policy is generally active and enforceable from the date it is issued.
However, if the insured dies during that period, the insurer often conducts a more detailed investigation before paying benefits.
Why Do Insurers Investigate Claims During the Contestability Period?
Insurance companies investigate these claims because they want to determine whether the insured:
- Omitted important medical information
- Misstated their health history
- Failed to disclose smoking or drug use
- Incorrectly reported medications or diagnoses
- Misrepresented dangerous hobbies or occupations
- Provided inaccurate financial information
- Concealed prior insurance denials
If the insurer believes the application contained a material misrepresentation, it may attempt to rescind the policy or deny the claim.
What Is a “Material Misrepresentation”?
Under Florida law, not every mistake on an insurance application justifies a denial.
The insurer typically must show that the alleged misrepresentation was material, meaning it affected the company’s decision to:
- Issue the policy
- Determine premiums
- Set coverage amounts
- Evaluate risk
For example, failing to disclose a significant heart condition or cancer diagnosis could potentially be considered material.
On the other hand, minor inaccuracies or innocent mistakes may not justify denying benefits.
Common Reasons Life Insurance Claims Are Denied During the Contestability Period
Insurance companies frequently cite the following reasons when denying claims:
1. Alleged Medical History Omissions
This is one of the most common reasons for denial.
The insurer may claim the insured failed to disclose:
- Prior surgeries
- Chronic illnesses
- Hospitalizations
- Mental health treatment
- Prescription drug use
In many cases, however, the insured may not have understood the question, forgotten the information, or relied on the insurance agent to complete the application accurately.
2. Smoking or Tobacco Use
Life insurance companies often charge higher premiums to smokers.
If medical records or toxicology reports indicate nicotine use, the insurer may argue the insured falsely claimed to be a non-smoker.
Disputes sometimes arise over:
- Occasional cigar use
- Vaping
- Nicotine patches
- Marijuana use
- Secondhand exposure
3. Misstatements About Alcohol or Drug Use
Insurers may investigate:
- Prescription medication history
- Substance abuse treatment
- DUI records
- Toxicology findings after death
However, the existence of alcohol or drugs does not automatically justify denial.
4. Failure to Disclose Pre-Existing Conditions
Insurance companies sometimes argue the insured concealed conditions such as:
- Diabetes
- Hypertension
- Heart disease
- Cancer
- Kidney disease
- Liver disease
But insurers must still prove the omission was material to underwriting.
5. Application Errors Made by the Insurance Agent
Sometimes the insured provided truthful information verbally, but the insurance agent incorrectly completed the application.
This issue can become important in Florida denial disputes because insurers may still try to blame the policyholder.
Can an Insurance Company Deny a Claim for Any Mistake?
No.
Florida law does not allow insurers to deny claims based on insignificant inaccuracies or trivial errors.
The insurer generally must prove:
- The statement was false
- The false statement was material
- The insurer relied on that statement when issuing the policy
In some cases, beneficiaries can challenge whether the insurer would truly have denied coverage had the correct information been disclosed.
What Happens If the Insured Died After the Contestability Period?
Once the contestability period expires, the insurer’s ability to challenge the policy becomes much more limited.
In many situations, the policy becomes “incontestable,” meaning the insurer cannot rescind coverage based on alleged application misrepresentations.
However, insurers may still investigate claims involving:
- Fraud
- Nonpayment of premiums
- Certain policy exclusions
- Lack of coverage at the time of death
How Long Does a Contestability Investigation Take?
There is no fixed timeframe.
Some investigations last a few weeks, while others continue for several months.
During the investigation, the insurer may request:
- Medical records
- Pharmacy records
- Autopsy reports
- Toxicology results
- Financial records
- Physician statements
- Prior insurance applications
Insurance companies sometimes use prolonged investigations to pressure beneficiaries into accepting less than the full policy value.
Warning Signs the Insurance Company May Be Preparing to Deny the Claim
Beneficiaries should be cautious if the insurer:
- Repeatedly requests the same records
- Delays communication
- Sends broad medical authorizations
- Focuses heavily on application details
- Requests records unrelated to the cause of death
- Suggests the insured “misrepresented” information
- Refuses to provide clear explanations
These may indicate the insurer is building a case to deny benefits.
What Should You Do If the Insurer Denies the Claim?
If a life insurance claim is denied during the contestability period, beneficiaries should not assume the denial is valid.
Important steps may include:
Request the Full Denial Letter
The denial letter may reveal:
- The exact basis for denial
- The alleged misrepresentation
- Policy provisions being relied upon
- Supporting documentation
Obtain the Policy and Application
Reviewing the original application is critical.
Sometimes beneficiaries discover:
- Incomplete questions
- Ambiguous wording
- Agent errors
- Missing signatures
- Incorrect answers entered electronically
Gather Medical Records
Medical records often become the central evidence in contestability disputes.
An attorney can help determine whether the insurer is mischaracterizing the records.
Speak With a Florida Life Insurance Lawyer
Contestability denials can involve complex legal and factual issues, including:
- Insurance law
- Underwriting practices
- Medical evidence
- Application interpretation
- Agent misconduct
- Bad faith conduct
An experienced Florida life insurance attorney may be able to challenge the denial and pursue the benefits owed under the policy.
Can Beneficiaries Sue After a Contestability Denial?
Yes.
If the insurer wrongfully denies benefits, beneficiaries may file a lawsuit seeking:
- Payment of policy proceeds
- Interest
- Attorney’s fees in certain situations
- Potential bad faith damages in appropriate cases
Many denied claims are ultimately resolved through litigation or settlement.
Final Thoughts
The contestability period gives insurance companies the right to investigate certain life insurance claims — but it does not give them unlimited power to deny benefits unfairly.
Florida beneficiaries should understand that:
- Not every application mistake voids coverage
- Insurers must prove material misrepresentations
- Delays and denials can often be challenged
- Beneficiaries may have strong legal rights under Florida law
If your family’s life insurance claim has been delayed or denied during the contestability period, speaking with an experienced Florida life insurance attorney may help you understand your options and protect your right to recover the benefits your loved one intended for you.
Have you or someone you know been denied a life insurance claim? Contact Florida Life Insurance Claims Lawyer J.P. Gonzalez-Sirgo by dialing his direct number at (786) 272-5841, calling the main office at (305) 461-1095, or Toll Free at 1 (866) 71-CLAIM or email Miami Attorney Gonzalez-Sirgo directly at jp@yourattorneys.com or by text at (305) 929-8935.
This article is for informational purposes only and does not constitute legal advice.
