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Say Jane has been diagnosed with cancer. She reaches the point where she is told that chemo/radiation may help extend life but will not cure the cancer. Jane chooses no chemo/radiation and begins looking at hospices upon recommendation. During hospice she hears of an alternative drug (animal dewormer) that has proven to help cure the cancer. She takes it but she still dies within a few months. Can the life insurance deny the claim due to the alternative drug?

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    What is the claim? Do you mean "compensation for money spent on unapproved drugs", or do you mean "life insurance payout because she died" and the question is whether the payout can be denied because of the unapproved drug?
    – user6726
    Oct 11, 2023 at 16:47
  • is the animal dewormer in any way proveable to be the cause of death?
    – Trish
    Oct 11, 2023 at 16:52
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    We need to know what country and state you are in to answer this. Also relevant: Is the medication approved for human use whatsoever (ie: are you asking about off-label use of an approved drug or use of an unapproved drug)?
    – Michael
    Oct 11, 2023 at 16:53
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    @user6726 They do mention life insurance in at the end of the body, so probably the latter.
    – Michael
    Oct 11, 2023 at 16:56
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    Whether the life insurance has an active suicide clause could be important.
    – user71659
    Oct 11, 2023 at 17:05

1 Answer 1

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Short Answer

Can life insurance claims be denied due to off-label use of alternative drug therapies?

No.

A life insurance claim cannot be denied for this reason.

Long Answer

A life insurance company can only refuse to pay the death benefit to some proper beneficiary for only four reasons: (1) the insured isn't dead, (2) one or more life insurance premiums were not paid and that resulted in a cancellation of the policy prior to the insureds death after a cancellation notice was send to the life insurance policy owner's last known address, (3) there was fraud in the life insurance application, or (4) the insured committed suicide.

But, life insurance claims can be denied for reasons (3) and (4) only before the life insurance policy becomes "incontestable" under the applicable insurance laws and regulations. Life insurance policies usually become incontestable one to two years after the life insurance policy is issued. The exact time in which the policy will become incontestable is stated in the life insurance contract which has to be pre-approved by insurance regulators.

Sometimes life insurance claims are not paid because the life insurance company goes bankrupt and is unable to pay, but that is not a denial of the life insurance claim.

Sometimes the named beneficiary can't be paid the death benefit because that beneficiary is dead, because that beneficiary refuses to accept and instead disclaims the death benefit, because the otherwise proper beneficiary murdered the insured, or because that person divorced the insured in a state where a life insurance beneficiary designation is revoked by operation of law upon divorce and wasn't subsequently reinstated as a beneficiary of the life insurance policy. But that just means that someone else will receive the death benefit. It does not mean that the life insurance company won't be obligated to pay the death benefit to some proper beneficiary.

Even if the life insurance policy is not incontestable, if there is no fraud in the life insurance application, and the health care treatment decision was made in good faith by the insured in an attempt to treat their medical condition, the health care treatment choices made by the insured are not a basis for denying a life insurance claim.

So, in this case, the life insurance claim could only be denied if the policy was not incontestable yet, and either (1) the cancer that caused the death or some fact pertinent to cancer death risk was not disclosed (or was misrepresented) in the life insurance application, or (2) it was determined that the alternative remedy was not used in good faith and was actually, in substance, a suicide attempt.

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