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Insurance Carrier: Lincoln Heritage Life Insurance
State: California

Consumer Complaint:

My wife passed away on Jan 31, 2009 . I notified Lincoln Heritage Life Ins by sending the certificate of death. She had applied for a $10,000 policy on her death and the Company sends me a check for $9,204.42. I phoned them and they said there was a descrincy on the application of my wifes birth date . She was born in 1938 and they had 1939, The age of 66 was in error and was circled and so was the age of 65 circled. The policy reads Death Benefit of $10,000. Why am I not getting the remainder that my wife applied for? We were never informed of any change of the Benefit amount. Could you please explain this to me?


Insurance Expert Answer:

First, my condolences on your loss. Second, let's answer your good question. You got less as the policy provided you'd only get what the premium would buy if the age had been correctly stated.

Virtually all life insurance policies have an age adjustment provision. It provides that if there is a misstatement of age, the face amount will be adjusted to reflect the amount of life insurance a person of the actual age would have been issued for the same premium as the decedent paid. So if a 50 year old claims he is 48, and is thus charged a lower premium, at death a lower benefit is paid out. That's a far more fair result than the insurer being able to claim she lied and you should get nothing. It also makes sure people are not rewarded for a misstatement by a family member.

By the way, age misstatement is not all that uncommon. It's not only Jack Benny who always claimed he was only 39. Often the truth never comes out until after the death.