What Reasons Would Life Insurance Not Payout?

Think that life insurance companies don't payout their policies? Think again!

One of the most common misconceptions with life insurance is that there is a high chance your insurance company may not pay out in the event of your death. This leads to many people wondering what the point in getting cover is. We are here to bust that myth and tell you that the overwhelming majority of policies do in fact get paid out. (Look here for some more myths!)

According to the Association of British Insurers, 98% of life insurance UK claims are paid annually. That leaves just 2% of life insurance policies which are left unpaid. Although it is extremely rare, there are a handful of reasons which may cause a life insurance policy to be invalidated.

Non-disclosure 👶

If you withhold any important details during the application stage, it could mean that your policy is invalid, so it’s important to be as accurate and truthful as possible. Not declaring a pre-existing condition would be a prime example of a reason that insurance companies may not pay out on a life insurance policy. It’s also a good idea to keep your insurance policy up-to-date with important changes in your life. So, if you become a parent for example, let your insurer know.

Exclusions ✍️

Depending on individual circumstances and the company, there may be certain exclusions written into your life insurance policy. For example, there may be a clause that if you were to move to a certain part of the world it could invalidate your policy - BUT you can live anywhere you’d like with Bequest Life! Or if you have a pre-existing condition and subsequently die of a related illness, your cover may not be valid. No matter who you get your will with, read all the fine print!

Fixed – term 🔒

With a term policy, living beyond the term set within fixed-term policies would mean that your loved ones would not receive a pay out in the event of your death. Whole life insurance covers you for your entire life, no matter what age you reach. We currently offer term-life cover.

Missed payment 💷

If you miss a payment without advance warning to your insurer, it could lead to your life insurance being cancelled and any future claims being declined. Communication is key here, if you’re unable to afford your premium payments or need to delay a payment, it’s a good idea to let your insurer know ahead of time, so that they can offer support where necessary. We offer the ability to take some time off from payments, so if you’re in need feel free to reach out alexa@bequest.com.

Waiting period ⏱️

Certain types of policies come with a waiting period, which means that if you die within 12 or 24 months of taking out the policy, you may not be covered. This is totally dependent on the specific cover you have with your insurer, so it may be a good idea to check. We don’t have any waiting period or mental health discrimination, it’s great.

Fraud 🚫

Insurance companies are within their rights to investigate claims, so it comes as no surprise to find out that if your claim is found to be fraudulent (if you’re not actually dead or terminally ill etc.) then the policy would not be paid out.


Although life insurance claims are very rarely rejected, if you find yourself in the situation where an insurer has not paid out, it’s possible to dispute the decision. The first thing you may want to consider doing is going through the complaints process, but if that doesn’t help, you could appeal to the Financial Ombudsman Service If the company is found to be in the wrong, they could be ordered to pay out.

Worrying about the possibility of your policy not being paid out, is no reason not to take out appropriate life cover. Remember, over 98% of life insurance policies do get paid out and it’s only in exceptionally rare circumstances that a policy is not paid out.

At Bequest, our life insurance cover pays out a lump sum if you pass away during the term of your policy. This means that your loved ones may be more equipped to deal with the financial implications of losing someone. If you are between 18-65, our life insurance may be perfect for your needs, and did you know that the younger you are, the cheaper your monthly payments? So, there really is no time like the present when it comes to life insurance. You may want to read our article, 7 Reasons to Explore Getting Life Insurance to help make up your mind!

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FF Bequest Limited, trading as Bequest, is authorised and regulated by the Financial Conduct Authority with firm reference number 923791. You can check our authorisation on the FCA Financial Services Register by visiting the following website: register.fca.org.uk . We are registered in England and Wales, Registered office address: Founders Factory, Northcliffe House, London, United Kingdom, W8 5EH. Company Number 12367897.

Regulated by the Information Commissioner's Office (ICO) [ZA662891]. “Bequest" is trademark protected by FF Bequest Limited (UK00003452648). FF Bequest Limited is registered in England and Wales, No 12367897.

0203 916 5433

FF Bequest Limited, trading as Bequest, is authorised and regulated by the Financial Conduct Authority with firm reference number 923791. You can check our authorisation on the FCA Financial Services Register by visiting the following website: register.fca.org.uk . We are registered in England and Wales, Registered office address: Founders Factory, Northcliffe House, London, United Kingdom, W8 5EH. Company Number 12367897.

Regulated by the Information Commissioner's Office (ICO) [ZA662891]. “Bequest" is trademark protected by FF Bequest Limited (UK00003452648). FF Bequest Limited is registered in England and Wales, No 12367897.

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