Can Insurance Companies Deny Coverage?

The Canadian health care system set up in 1967 was a huge success. The health care system, also known as Medicare in Canada, is a publicly funded system that provides health services to Canadian citizens. The government aims to implement federal standards in the country so that people with all types of medical history, the standard of living, and income can afford healthcare within Canada. There are health costs that the government health care system does not cover.

Understanding The Canadian Health Care System

Canadian provinces and territories independently manage their universal health insurance program for their residents. The provinces establish their criteria for health coverage and medical emergencies and conditions covered by the system. According to the standards, people who enter the country illegally can not get health care coverage unless they have permanent residence. Canadian citizens can get doctor’s visits, diagnostic tests, and hospital treatment through the taxes paid by Canadian citizens.

What Is Not Covered By The Canadian Health Care System

The only provinces that charge a monthly premium are Alberta and B.C. Anyone who earns more than $30,000 per annum in B.C. pays $69.25 monthly for health coverage. The government health care system does not cover the costs of cosmetic surgery, health counselors, dental treatment, hearing aids, optometric treatment, physiotherapists, psychologists, and private hospital rooms. Canadians must have private health insurance if they want all-inclusive health coverage.

Understanding Life Insurance In Canada

It is hard to cope with the death of a loved one. It can be even more complicated to prevent challenges in life when you find out that a life insurance claim gets denied. Understandably no amount of money can replace the love you got from the one you lost. The tragedy exacerbates if you were financially dependent on the person that passed away.

Can Life Insurance Companies Deny Your Claim?

Most people believe that life insurance is guaranteed protection, but the truth is that life insurance claims can be declined. Insurance companies thoroughly investigate the terms and conditions of the insurance policy before processing a payout to the assigned beneficiary of the life insurance policy. In the investigation, insurance companies verify that the policyholder has fulfilled all of the terms and conditions of the life insurance policy. The life insurance provider reserves the right to refund all the premiums without processing a payout to the beneficiary if the investigation concludes that the policyholder violated any of the terms and conditions of the life insurance policy.

In other words, life insurance providers can deny a life insurance claim under certain circumstances. Let’s look at some of the most common reasons for the denial of a life insurance claim.

Unpaid Policy Premiums

A life insurance policy is an agreement between the insurance company and the policyholder. Based on the agreement, the insurance provider agrees to pay out a death benefit to the beneficiary in return for premium payments from the policyholder. The insurance provider can refuse to issue a death benefit to the listed beneficiary if the policyholder does not pay the premiums for the policy. Life insurance providers accommodate the policyholder with a 30-day grace period.

The life insurance policy is valid if the policyholder pays the remaining premiums within the grace period. The life insurance provider can cancel the policy if the policyholder does not make the necessary payments within the grace period.

The Reason For Death Is Not Covered In The Life Insurance Policy

Exclusions to life insurance policies highlight the causes of death life insurance providers do not cover. Exclusions are in an easy-to-understand language in the life insurance policy. It is the responsibility of the policyholder and beneficiaries to acknowledge all exclusions to a life insurance policy. The life insurance provider does not disburse a death payout based on these exclusions, even if the beneficiary is not aware of the exclusions to a life insurance policy.

For example, most life insurance providers do not issue a death payout if the policyholder dies by committing suicide within the first two years.  Do not sign a new life insurance policy unless you are aware of all the exclusions of the life insurance policy.

Life Insurance Policyholder Does Not Provide Accurate Information

Providing misleading or inaccurate information on a life insurance policy form is one of the main reasons for a life insurance claim denial. Life insurance providers require new policyholders to provide comprehensive information about their physical health. The policyholder’s health condition determines the provisions of the life insurance policy. The policy becomes invalid if the policyholder provides inaccurate information about their health.

For example, a person has a history of driving under the influence of alcohol. The person does not reveal their history of alcohol abuse while applying for the life insurance policy. The person experiences a fatal DUI accident. The life insurance provider discovers the policyholder’s history of alcohol abuse at the deadly DUI accident.

Life insurance providers do not issue a death payout because the applicant failed to reveal mandatory information from the start. The same goes for a policyholder who requests a doctor to provide incorrect information to fill up a life insurance form. Do not expect a life insurance company to provide compensation if the insurance company discovers new information related to the policyholder’s health on their death.

The Beneficiary Is Not Named

A beneficiary is a person that receives the death benefit of a life insurance policy. Policyholders must indicate the beneficiary name to the life insurance provider. You cannot nominate a new beneficiary when the policyholder dies. Life insurance providers inform beneficiaries of their status when the insurance provider approves the life insurance policy for the policyholder.

The entire death benefit goes to the estate of the deceased if there are no beneficiaries for the life insurance policy. The estate of the deceased goes through the government probate process before anybody receives any remuneration. The probate process is not as swift and speedy as the life insurance claim.

Denied Health Or Life Insurance, Consult A Professional Insurance Company

It is not easy to choose the right insurance policy, whether it is for life insurance or health insurance. Policyholders are denied coverage for several reasons. Consult with a professional insurance broker like McIver Insurance to ensure that you purchase a policy based on your specific needs. A professional consultation before buying an insurance policy ensures that you understand all the terms and conditions that can lead to being denied coverage for a claim.