Average Settlement for Denied Life Insurance Claims in Alberta
When your life insurance claim is denied, the financial shock can be devastating. You've paid premiums for years, your loved one has passed, yet the insurer refuses to pay the death benefit.
But denials are rarely final. In Alberta, most denied life insurance claims are negotiated and settled, often for hundreds of thousands of dollars—sometimes more than the original policy value.
Settlements depend on the policy's value, the insurer's conduct, and the strength of your evidence. Strong cases can lead to recovery beyond the original benefit, including interest, legal costs, and bad-faith damages.
As Alberta insurance-litigation lawyers who previously defended insurers, we understand how companies assess risk and why they settle quickly when challenged. This article explains how settlements for denied life-insurance claims work, what influences payout values, and what Alberta families can expect when fighting back.
This guide covers:
What Is a Life-Insurance Claim?
Life insurance pays a death benefit upon the insured's passing. Alberta families often have multiple forms of coverage:
Types of Life Insurance:
Common Insurance Challenges in Alberta
Most life-insurance denials follow familiar patterns. Insurers often rely on:
Alleged Misrepresentation
Insurer claims the application contained false or incomplete information.
Two-Year Contestability Period
Deaths within two years of policy issuance are subject to heightened scrutiny.
Pre-Existing Medical Conditions
Insurer argues the condition existed before coverage and wasn't disclosed.
Policy Lapses
Non-payment or missed premium deadlines.
Suicide Exclusions
Policies often exclude suicide during the early policy term (typically two years).
Administrative Mistakes
Missing beneficiary forms or incomplete documentation.
Key point: While these explanations sound final, Alberta law requires insurers to prove a denial was justified and made in good faith. Many denials collapse under scrutiny.
Steps to Take After a Life Insurance Denial
Following these steps immediately after a denial can significantly strengthen your case and protect your rights to compensation.
Request the Denial Letter in Writing
The insurer must provide a written explanation of the denial with specific policy references.
Gather All Policy Documents
Collect the complete policy, application, and all correspondence with the insurer.
Preserve Medical Records
Obtain medical and coroner's reports related to the cause of death.
Document Premium Payments
Gather proof of all premium payments to show the policy was active.
Contact an Alberta Life Insurance Lawyer
Early legal involvement ensures evidence is preserved and deadlines are met.
How a Lawyer Increases Settlement Value
An experienced Alberta insurance lawyer provides both leverage and clarity in negotiation.
Obtain Internal Claim Files
Obtain the insurer's internal claim notes and underwriting file.
Identify Supportive Policy Wording
Identify policy wording that supports your position.
Secure Independent Expert Opinions
Secure independent medical and legal opinions.
Quantify Bad-Faith Damages
Quantify potential bad-faith damages.
Negotiate Aggressively
Negotiate aggressively for full recovery.
Frequently Asked Questions
Conclusion
Life-insurance denials are not the end of the story — they're the beginning of a negotiation. Alberta families routinely recover substantial settlements when insurers are challenged with evidence and legal expertise.
Denials can be overturned, and settlements often exceed initial policy amounts.
Strong documentation and legal representation increase payout value.
Alberta courts penalize insurers for delay and bad faith.
Still have questions? Contact us today — your consultation is free.
Call or text us today for a free consultation. No fee unless we win.