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The answer to that question depends on your coverage. Is there an exclusion to coverage when you're driving without a valid license? Have they attempted to not pay and if so, based on what contract language?
I would need that information before answering your question.
If there is an exclusion, then yes, they could refuse to pay. If there isn't an exclusion, no, they can't. It all comes down to the contract itself.
I hope this helps.
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DISCLAIMER: This is not legal advice and I am not your lawyer. My questions are based on my knowledge of the jurisdiction where I am admitted to practice, my experience on this site over several years, and research on the relevant laws and statutes for your jurisdiction, if any. My information is not advice and you should always speak to local counsel before you act.