O’Ryan Law Firm, on behalf of our client, Regan W., recently won an appeal of MetLife’s decision to deny payment of a $66,000 death benefit for a life insurance policy purchased by Regan’s late father prior to his death. As a result of O’Ryan Law Firm’s work, MetLife paid the full $66,000 death benefit, plus more than $2,000 in interest for the time in which it had wrongfully withheld the benefit payment.
Approximately two years before his death, Regan’s father signed up for optional life insurance (“OLI”) offered by his employer through MetLife, with a death benefit of $66,000. According to the fine print of the OLI policy, MetLife was entitled to request additional evidence of insurability, including a Statement of Health form, before allowing the coverage to take effect. However, neither MetLife nor his employer ever requested any such evidence from Regan’s father. Instead, his employer began deducting the premiums for his OLI coverage from his paychecks. Regan’s father continued to pay the premiums, via payroll deduction, as they became due, until he passed away in late 2017. MetLife happily accepted these premium payments, while never insisting on any “evidence of insurability.”
When Regan made a claim for the death benefits under her father’s MetLife policy, MetLife refused to pay the $66,000 OLI death benefit, arguing that her father’s coverage had never taken effect because he never submitted a Statement of Health form as the policy required. As we noted in a previous blog post, this scenario has recently become increasingly common with MetLife policies.