Dennis BeaverApril 6, 2021 • By Dennis Beaver 

If you thought that only auto or property insurance companies were out to deny claims that should be paid, today’s story will be a wake-up call for anyone who has a life insurance policy. That’s right. Life insurance companies are no different, no better than any other — if they can squeak out of paying a death benefit using flawed justification, they will.

“Fawn,” who is the CEO of a Midwest technology company, discovered that reality:

“I had a $1 million Key Employee life insurance policy on ‘Darin,’ our sales manager. There was an accidental death provision which would pay double the face amount of the policy.

“Darin suffered from depression after his wife was killed by a drunk driver. He fell in with a bad crowd. At a party he was given a fatal dose of fentanyl. The coroner determined this to have been an accidental overdose.

“We filed for the death benefit, the insurance company conducted a months-long investigation and claimed — without any evidence — that he was a long-time drug abuser. Payment was refused as they had a clause in the policy addressing illegal drug use.

“We retained a lawyer who was successful in getting them to pay the full policy benefit, but this took well over a year and was expensive.

“While Darin was not a drug user, people who use illegal drugs need to know that, if they have life insurance, the company might refuse to pay benefits to their family.” She’s absolutely correct.

‘Evidence of drug use’
If you would like a real eye-opener about life insurance companies and drug use as a claimed way out of paying death benefits, just spend a few minutes talking with Los Angeles-based attorney Joe Fogel, as I did recently.

“We know that drug use has gone way up during the pandemic and companies are denying more claims because of it,” Fogel points out.

“When life Insurance companies acquire information that the named insured had used drugs, often they become much more aggressive on claims, refusing to pay even if it can’t be clearly demonstrated that the terms of the policy were violated, or that the drug was the cause of death.

“People who are in emotional and financial distress receive scary letters from life insurance companies saying that the claim won’t be paid unless they receive a laundry list of documents and answers to a ton of questions — all designed to show that the decedent somehow violated terms of the life insurance contract.”

In my own law practice, I’ve seen these letters and requests which are designed to wear people out. To Fogel, “The ordinary person is not in a position to respond in the way the insurance company requires and the result is that they often fail to pay claims that are owed.”

What if the claim isn’t paid?

Joe Fogel has this advice to individuals and families where drug use is an issue:

“If you are addicted to a drug do not assume the policy will pay!  If you do have a drug involvement in your life, take extra precautions; do not be driving, do not be on a boat, or do things that might increase the risk of your death and give the insurance company a reason to not pay on your policy.

1. If you know your loved one had drugs or alcohol involved in the loss of their life, and you have not received payment, then realize that your claim is under investigation.

2. Watch what you say to the insurance company no matter how nice they may sound on the phone! While you have a duty to co-operate, you do not have to do everything they say without justification. They are asking you questions for a reason, and reading from a play book written by company lawyers intended to defeat your legitimate interest in being paid the death benefit.

3. Find a copy of the policy or get it from the company.

4. Don’t lie! You have an obligation to cooperate and to be truthful. False statements will cost you the case.

Fogel concluded our interview with this cautionary statement:

“When it is a close call, insurance law requires that the policy be paid. Once you have provided them a death certificate they have what they need to pay.  When they do not, there is a problem. If you get the run around, and they keep coming up with more and more questions, these are signs that it is time to talk with a lawyer.”

Fogel’s website is: and is well worth your time if anything in today’s story applies to your family or someone you know.


Dennis Beaver practices law in Bakersfield and enjoys hearing from his readers. Contact Dennis Beaver.