I am often contacted by potential clients who are surprised to learn that the whole life insurance policy (that their family member had been paying for over many years) allegedly lapsed shortly before the insured’s death.

The lapse allegation often stems from the fact that the cost to maintain the policy increases as the insured ages. The premiums can become quite high when the insured reached their 70s or 80s, for example. Often insurance sales people do not adequately explain that monthly premiums the insured has paid for years or even decades will not be nearly enough to cover the increasing premiums. In fact, I have personally had an insurance salesperson tell me that premiums do not increase on a particular whole life policy when that was actually untrue.

When the increasing “cost of insurance” eclipses premium payments, the policy’s cash value will be reduced. If a loan was taken out against the cash value, the loan payments (including interest) will further erode what remains of the cash value.

When the insured is on death’s doorstep they may not be in a position to handle their finances and, in particular to, replenish the case value in their whole life policy such that it remains in force.

This confluence of factors leads to the insured potentially losing their life insurance coverage at the very worst time i.e. shortly before their death.

However, there are laws in place to potentially protect beneficiaries from suffering from this ill-timed and unfair consequence.

If your loved on died within close proximity to their whole life insurance policy, or term life insurance policy, allegedly lapsing, it is highly recommended that you contact me at 612-808-9082 or msanti@santicerny.com. Do not simply believe the life insurance company when then allege that the policy has lapsed and there is nothing that can be done. I have changed their stance many, many times.