When a loved one dies, life insurance proceeds can provide critical financial support for surviving family members and other beneficiaries. Unfortunately, some beneficiaries submit all requested documents only to find themselves waiting weeks or months while the life insurance company continues to say the claim is “under review.”
At some point, beneficiaries may understandably ask: How long can a life insurance company delay payment—and can an unreasonable delay constitute bad faith?
In Florida, a delay does not automatically mean an insurer has acted in bad faith. Life insurance companies are entitled to conduct legitimate investigations before paying claims. However, an insurer that unnecessarily prolongs an investigation, repeatedly requests irrelevant or duplicative information, fails to communicate, or refuses to pay after its obligation has become reasonably clear may raise significant legal issues.
Understanding the difference between a legitimate life insurance claim investigation and an unreasonable delay can help beneficiaries protect their rights.
Why Do Life Insurance Companies Delay Claims?
There are legitimate reasons why a life insurance claim may take longer than expected. An insurer may need to investigate issues involving:
- The insured's cause of death;
- Statements made on the life insurance application;
- Whether premiums were paid and the policy was in force;
- The identity of the proper beneficiary;
- A recent beneficiary change;
- Competing beneficiary claims;
- The policy's contestability period;
- A possible policy exclusion;
- Questions concerning the insured's medical history; or
- Possible fraud or material misrepresentation.
A reasonable investigation is generally not the same thing as bad faith.
The problem arises when the investigation appears to have no reasonable endpoint—or when the insurer seems to be using the investigation itself as a justification for withholding benefits.
What Is Life Insurance Bad Faith in Florida?
Florida law recognizes circumstances in which an insurance company's handling of a claim can give rise to a bad-faith claim.
Florida Statute § 624.155 provides a civil remedy under specified circumstances, including when an insurer fails to attempt in good faith to settle a claim when, under all the circumstances, it could and should have done so had it acted fairly and honestly and with due regard for the insured's interests. Florida law also makes certain unfair claim-settlement practices actionable through the statutory framework.
Importantly, delay alone does not necessarily establish bad faith. Florida's bad-faith statute expressly provides that mere negligence alone is insufficient. The insurer's conduct must therefore be evaluated in the context of the entire claim.
The central question often becomes:
Was the insurance company conducting a reasonable investigation, or was it unnecessarily delaying payment of a valid claim?
When Can a Life Insurance Claim Delay Become Unreasonable?
There is no universal number of days after which every delayed life insurance claim automatically becomes bad faith.
Instead, the circumstances surrounding the delay matter.
Potential warning signs include an insurer that:
1. Repeatedly Requests the Same Documents
A beneficiary may provide the death certificate, claim forms, medical authorizations, and other requested information, only to receive repeated requests for documents that have already been submitted.
Occasional administrative mistakes happen. Repeated or unnecessary document requests, however, may deserve closer examination.
2. Requests Information That Has Little to Do With the Claim
During a contestability investigation, for example, an insurer may legitimately investigate information contained in the insured's application.
But an investigation should have a legitimate purpose.
Repeated requests for information having little apparent connection to the insurer's coverage determination may raise questions about whether the investigation is being conducted reasonably.
3. Stops Communicating With the Beneficiary
Another warning sign is prolonged silence.
The beneficiary calls and receives no meaningful response. Emails go unanswered. The claims representative repeatedly says that the matter remains “under review” without explaining what remains outstanding.
Florida's unfair insurance practices statute addresses various claim-handling practices, including failing to acknowledge and act promptly upon claim communications and denying claims without conducting reasonable investigations based upon available information when the statutory requirements are satisfied.
4. Keeps the Claim Under Investigation Without Explaining Why
An insurer should not be able to turn an investigation into an indefinite holding period merely by repeatedly saying that additional review is necessary.
If months are passing, a beneficiary may want to determine:
What exactly is the insurance company investigating?
What information is still missing?
Why is that information necessary?
Has the insurer already received everything necessary to make its decision?
The answers can help distinguish a legitimate investigation from an unreasonable delay.
5. Fails to Pay After Liability Becomes Reasonably Clear
This can be particularly important.
An investigation may initially be justified. But circumstances can change as the insurer receives medical records, policy documents, beneficiary information, and other evidence.
Once the insurer possesses the information necessary to evaluate the claim, continued delay may become increasingly difficult to justify.
Florida's bad-faith statute specifically addresses an insurer's failure to attempt in good faith to settle claims when, under all the circumstances, it could and should have done so.
How Long Does a Florida Life Insurance Company Have to Pay a Death Claim?
Florida law contains provisions specifically governing life insurance settlements.
Florida Statute § 627.461 provides for settlement upon receipt of due proof of death and surrender of the policy, where required, subject to the policy's terms and applicable law.
Florida law also addresses interest on life insurance death benefits.
Under Florida Statute § 627.4615, when a life insurance policy provides for a lump-sum payment upon death, the payment must include interest at the statutorily prescribed rate from the date the insurer receives written due proof of death.
This interest requirement is important because beneficiaries may be entitled to more than simply the policy's stated death benefit when payment has been delayed.
The specific statutes, policy provisions, type of life insurance coverage, and circumstances of the claim should be reviewed before determining what deadlines or remedies apply.
Is a Long Contestability Investigation Bad Faith?
Not necessarily.
Many life insurance policies contain a contestability period, commonly involving the first two years after the policy becomes effective. If the insured dies during that period, the insurance company may closely review the application and underlying records before paying the death benefit.
The insurer may request:
- Medical records;
- Prescription histories;
- Physician records;
- Prior insurance applications;
- Financial information;
- Employment information; and
- Other documents relevant to statements made in the application.
The fact that the insurer conducts a contestability investigation does not by itself mean that it is acting improperly.
However, a contestability investigation should not necessarily give the insurer unlimited time to decide the claim.
If the insurer has obtained the relevant records but continues delaying its decision without a legitimate reason, the beneficiary may have grounds to challenge the insurer's conduct.
What About Delays Caused by Beneficiary Disputes?
Some delayed claims involve legitimate uncertainty over who should receive the proceeds.
For example:
- Two people may claim to be the beneficiary;
- A beneficiary designation may have been changed shortly before death;
- An ex-spouse may remain listed on the policy;
- Someone may challenge a beneficiary change based upon incapacity, fraud, or undue influence;
- The named beneficiary may have died before the insured; or
- The insurer may receive conflicting claims to the proceeds.
In these situations, the insurer may file an interpleader action, asking a court to determine who is legally entitled to the death benefit.
An interpleader case is different from an insurer simply refusing to make a decision on an otherwise straightforward claim. Whether the insurer's actions were reasonable depends heavily upon the facts.
What Evidence Can Help Establish Unreasonable Delay?
Beneficiaries dealing with a delayed life insurance claim should maintain a complete claim file.
Important evidence may include:
- The life insurance policy;
- The insurance application;
- The beneficiary designation;
- The certified death certificate;
- The original claim submission;
- Proof showing when the insurer received the claim;
- Emails with claims representatives;
- Letters from the insurer;
- Requests for additional information;
- Documents supplied in response to those requests;
- Notes from telephone conversations;
- Claim status updates; and
- Any denial or reservation-of-rights correspondence.
A detailed chronology can be particularly valuable.
For example:
January 5: Claim submitted.
January 12: Insurer requests medical authorization.
January 14: Authorization provided.
February 20: Insurer requests the same authorization again.
February 21: Beneficiary resends authorization.
April 1: Insurer says claim remains under review.
May 15: Insurer provides no substantive explanation for the continuing delay.
A timeline can reveal patterns that are difficult to see when reviewing correspondence individually.
Can You Sue a Life Insurance Company for Bad Faith in Florida?
Potentially, but Florida insurance bad-faith claims involve specific substantive and procedural requirements.
Florida Statute § 624.155 generally requires a Civil Remedy Notice as a condition precedent to an action under the statute. The notice must identify specified information concerning the alleged violations, facts and circumstances, relevant policy language where applicable, and other required information. The statute generally provides the insurer a 60-day period in which the damages may be paid or the circumstances giving rise to the violation corrected.
For that reason, a beneficiary should not assume that simply experiencing a lengthy delay automatically creates an immediately actionable bad-faith lawsuit.
The underlying policy claim, insurer's conduct, applicable statutes, notices, timing, and damages all require careful analysis.
What Damages May Be Available in a Life Insurance Dispute?
The potential recovery depends upon the nature of the case.
A beneficiary may seek recovery of the life insurance death benefit if the insurer wrongfully refuses to pay a covered claim.
Interest may also be recoverable. As noted above, Florida Statute § 627.4615 requires qualifying lump-sum death claim payments to include interest calculated from the insurer's receipt of written due proof of death.
Additional damages may potentially become relevant when legally actionable bad faith can be established, depending upon the circumstances and applicable law.
Because contractual benefits and extra-contractual bad-faith damages involve different legal issues, the distinction is important when evaluating a delayed life insurance claim.
What Should You Do If Your Life Insurance Claim Is Being Delayed?
If you are a beneficiary waiting for life insurance proceeds, consider taking the following steps:
- Request the claim status in writing. Ask exactly why the claim remains pending.
- Ask what documents remain outstanding. Do not assume the insurer has everything simply because documents were previously sent.
- Keep proof of every submission. Save emails, fax confirmations, certified-mail receipts, and upload confirmations.
- Request specific explanations. If the insurer says the claim is “under investigation,” ask what issue remains under investigation.
- Keep a claim chronology. Record every communication, request, response, and deadline.
- Do not ignore insurer correspondence. A legitimate request for information should be addressed promptly.
- Consider speaking with a Florida life insurance claims attorney. This may be particularly important when substantial benefits are involved, the claim has been pending for an extended period, or the insurer's explanation for the delay is unclear.
Does Hiring a Lawyer Mean You Have to File a Lawsuit?
No.
An attorney may first review the policy, claim documents, correspondence, investigation history, and applicable law to determine why the claim has stalled.
Depending upon the circumstances, an attorney may communicate directly with the insurer, determine what information remains outstanding, challenge unnecessary requests, demand a coverage determination, or evaluate whether litigation or a statutory bad-faith remedy should be pursued.
In some cases, focused legal intervention may help move a claim forward without litigation. In others, filing suit may become necessary.
Frequently Asked Questions About Delayed Life Insurance Claims
How long is too long for a life insurance claim?
There is no single period that automatically establishes bad faith in every Florida life insurance claim. The complexity of the claim, reason for the investigation, information available to the insurer, policy provisions, and insurer's conduct must all be considered.
Can an insurance company investigate a life insurance claim for months?
Potentially. Some claims legitimately require substantial investigation, particularly claims involving the contestability period, suspected material misrepresentations, unusual circumstances surrounding the death, or competing beneficiaries. The issue is whether the scope and length of the investigation remain reasonable under the circumstances.
Can the insurer keep asking for more documents?
An insurer may request information reasonably necessary to investigate the claim. Repetitive, irrelevant, or seemingly endless requests may warrant closer scrutiny.
Does unreasonable delay automatically equal bad faith?
No. Delay is one factor. Florida law expressly provides that mere negligence alone is insufficient to constitute bad faith.
Am I entitled to interest if the insurer delays payment?
Florida Statute § 627.4615 provides that qualifying lump-sum life insurance death claim payments include interest from the date the insurer receives written due proof of death, calculated according to the statutory standard.
Can a lawyer help before my claim is formally denied?
Yes. You do not necessarily have to wait for a formal denial to seek legal advice regarding a life insurance claim that has been delayed.
Florida Life Insurance Claim Delays Should Not Be Ignored
A life insurance company has the right to investigate legitimate coverage questions. But an investigation should not become an excuse to postpone payment indefinitely.
When an insurer repeatedly requests information, stops communicating, conducts an investigation with no apparent endpoint, or continues withholding benefits after its obligations have become reasonably clear, beneficiaries should consider whether the delay is justified.
The larger the policy and the longer the unexplained delay continues, the more important it may become to have the claim independently evaluated.
Speak With a Florida Life Insurance Claims Lawyer
If a life insurance company is delaying payment of a death benefit, J.P. Gonzalez-Sirgo, P.A. represents beneficiaries in Florida life insurance disputes, including delayed claims, denied claims, contestability investigations, beneficiary disputes, and potential bad-faith matters.
A careful review of the policy and claim history can help determine whether the insurance company's investigation is legitimate, whether additional information is actually necessary, and what options may be available to pursue payment.
Contact J.P. Gonzalez-Sirgo, P.A. for a confidential consultation regarding a delayed or disputed Florida life insurance claim.
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.
