Denial of Life Insurance and Accident Benefits in Missouri and Kansas

Suppose an insured person lives in Missouri or Kansas and names you as the beneficiary in a life insurance policy, but the insurance company denies paying benefits because something was omitted or misstated in the application for insurance. You assume that you can’t receive the benefits, but that may not truly be the case if the insured lived in Missouri or Kansas.

Recently, Don Lolli successfully convinced an insurance carrier to withdraw its denial of benefits by demonstrating that the alleged omission in a Missouri insurance application did not contribute to the insured’s death. The full policy benefits were paid to the beneficiary, plus interest.

Let’s look at another example. A prospective insured omits information about his current medical condition (smoking) in an application for life insurance. The omission is not material and does not render the policy void unless the omitted information actually contributed to the death of the insured (like lung cancer due to smoking). However, if the insured smoker dies from a car accident, his smoking has nothing to do with his cause of death. So the insurance company could not deny the beneficiary’s claim to the policy.

Missouri law requires that in order to deny payment of a life insurance policy based on a misstatement or omission by the insured in obtaining the policy, the insurer must have evidence that the matter misstated or omitted must actually contribute to the event which triggers the payment of benefits. If such evidence exists, this presents a question of fact for a jury to determine whether benefits are payable. This same requirement applies to health and accident insurance for Missouri insureds.

Kansas law is similar to Missouri law for life insurance and accident and sickness insurance. However, there are some exceptions in Kansas.



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