Thursday, September 10, 2026

How Advisors Should Respond When a Claim Is Denied


A denied claim is one of the most difficult moments in an advisor-client relationship. The client may feel disappointed, confused or even betrayed.

The advisor should not disappear, become defensive or immediately promise that the decision will be reversed. The proper response is to help the client understand the decision and pursue every legitimate remedy available.


1. Stay with the client and acknowledge the disappointment

Do not begin by defending the company or explaining why the client may be wrong.

Start by recognizing what the decision means to the family:

“I understand how disappointing this is. Let me help you review the reason for the denial and determine what options remain available.”

At this stage, the client needs a calm and responsible guide. Avoid blaming the claimant, underwriting department, hospital, previous advisor or insurer before the facts have been established.

The advisor may not control the claim decision, but the advisor can control whether the client faces it alone.


2. Obtain the formal reason and review the complete record

Do not rely on a verbal explanation, an informal message or assumptions. Request the written denial and identify the policy provision on which the decision was based.

Review the relevant documents, including:

    • Policy contract and applicable riders
    • Application and health declarations
    • Underwriting decisions or exclusions
    • Claim forms and submitted records
    • Medical reports and supporting documents
    • Premium and policy-status records
    • The insurer’s written explanation
    • Any missing, inconsistent or misunderstood information

Determine whether the claim was denied because it was genuinely not covered, an exclusion applied, the policy was not in force, documentation was incomplete, or some material fact remains disputed.

Before challenging the decision, understand exactly what decision was made—and why.


3. Guide the client through the proper review or appeal process

If there is a reasonable basis for reconsideration, help the client use the insurer’s formal review or appeal process.

The advisor can assist by:

    • Clarifying what additional evidence is required
    • Helping organize the documents chronologically
    • Coordinating with the claims department
    • Correcting factual or administrative errors
    • Preparing a clear written request for reconsideration
    • Monitoring deadlines and documenting communications
    • Explaining the available escalation or complaint channels

However, do not promise approval or encourage the client to exaggerate, conceal or alter information.

You may say:

“We cannot guarantee that the decision will change, but we can make sure that the claim is reviewed using complete and accurate information.”

Professional support means pursuing a fair review—not creating false hope.


4. Accept the outcome honestly and examine the original advice

If the denial is upheld, explain the result clearly and compassionately. Do not hide behind technical language or blame the client for not reading the policy.

The advisor must also reflect on the original sale:

    • Was the coverage explained accurately?
    • Were exclusions and waiting periods discussed?
    • Did the client understand what was not covered?
    • Were health questions completed carefully?
    • Was the recommendation appropriate for the client’s needs?
    • Were expectations created that the policy contract could not support?

If the earlier explanation contributed to the misunderstanding, acknowledge it and determine what corrective action is appropriate.

A denied claim does not always mean that the advisor made a mistake. But every denied claim should prompt the advisor to examine whether the client was properly informed and responsibly served.

The advisor cannot promise that every claim will be paid. But the advisor can promise not to disappear when the client needs guidance most.


All the best my friends!!

#acgadvice

You Educated the Prospect—but Another Advisor Closed the Sale

 


Few experiences frustrate an advisor more than spending time educating a prospect, only to discover that someone else received the business. 

It may feel unfair—but it can also reveal where a good advisory conversation failed to become a clear decision.


1. Accept That Education Does Not Create Ownership

Helping someone understand financial planning does not give us a claim over their eventual decision. 

Prospects remain free to compare advisors, products and recommendations.

Educate generously, but do not assume that gratitude will automatically become commitment. 

The value you provided still reflects your professionalism—even when it does not immediately produce a sale.


2. Find Out Where the Decision Stalled

The other advisor may not have explained the subject better. 

They may simply have made the next step easier.

Review the conversation honestly:

    • Did you make a specific recommendation?
    • Did the prospect understand why it suited them?
    • Did you address the real objection?
    • Did you clearly ask them to proceed?
    • Did you agree on a follow-up date?

Good education creates understanding. 

Closing requires helping the prospect turn that understanding into a decision.


3. Ask for Feedback Without Sounding Bitter

If appropriate, thank the prospect for informing you and respectfully ask what influenced the choice. 

Do not criticize the other advisor or make the prospect defend their decision.

You might say:

“I respect your decision. If you are comfortable sharing, may I ask what helped you choose the other proposal? Your feedback would help me serve future clients better.”

The answer may reveal a weakness in your recommendation, timing, communication or follow-through that you would otherwise repeat.


4. Preserve the Relationship After Losing the Sale

Do not disappear merely because another advisor closed the transaction. 

Congratulate the client, remain gracious and leave the door open—without interfering with the new advisor’s relationship.

Circumstances change. People remember who educated them patiently, respected their choice and remained professional after losing. 

Today’s lost sale may still become tomorrow’s referral, consultation or second opportunity.

You may not receive every sale you helped make possible—but the way you respond will determine whether you earned lasting trust.


All the best my friends!!

#acgadvice