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Dimitry K., Esq.
Dimitry K., Esq., Attorney
Category: Legal
Satisfied Customers: 41221
Experience:  Multiple jurisdictions, specialize in business/contract disputes, estate creation and administration.
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I just found out that my uncle had 2 life insurance policies when he passed away. In the

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I just found out that my uncle had 2 life insurance policies when he passed away. In the last few weeks of his life, he was hospitalized and literally not conscious most of the time. He was in that state when his insurance premiums came due for the month, and was physically unable to pay them (was almost completely unaware). Unfortunately, no one in the family knew about the payment either. It was the only payment he ever missed in the many years he had the policies, and both companies (as I just found out) refused to pay out a dime because he had missed that last payment (while mostly unconscious and being cared for).
Any possible legal recourse for his beneficiaries? Also, is there a statutory time limitation in which we have to act? As I said, I just found out about this situation today, but he actually passed about 3 years ago. I'm not a beneficiary, so I have no financial stake in this, but would love to see his kids get some of what he worked so hard to ensure them. Thank

Thank you for your question. Please permit me to assist you with your concerns.

Let me preface my answer by stating that this is a bit of an uphill struggle. Once payments are missed and insurance lapses, the company is generally not liable. I am assuming these were term-life policies because whole-life and universal life policies may be able to be used to cover the premiums for a time from within if they built up some equity. So at least with pure term life policies, once they default, they default and make the insurer no longer liable.

What I can suggest is to have an attorney review the contractual language. Many insurers provide 30 days to make payments and ensure that policy does not lapse. This is done until and before the covered party passes away. So in theory it might be possible to review terms and maybe send in the funds for the premium, reinstate the policy, and have it pay out. But this isn't a statutory obligation but purely contractual. The language under which these policies was written is what governs. This is why having a professional evaluate the policies may be wise, so as to see if there are clauses within the agreements (or what the policies even were) could be used to reverse the insurer's stance.

Good luck.

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