How to Dispute If Insurance Denies a Theft Claim

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Auto insurance and property insurance carriers offer drivers and homeowners theft coverage as additional policies or products. Although some insurance companies may offer their customers some limited theft coverage as part of their general insurance policies, most offer expanded or extra theft coverage as an endorsement to their existing general coverage policies for an additional fee. Furthermore, many financial institutions and credit card companies offer their cardholder customers identify theft or unauthorized use coverage for an additional monthly fee to protect them against unauthorized third-party charges. If you submitted a theft claim to your insurance company and received a claim denial, you can dispute the denial.

Contact your insurance company and ask a representative to provide you with a written reason for denying your theft claim.

Review the written response from your insurance company. If the basis for your denial was lack of coverage, you need to review your declaration or policy statement outlining your coverage and limits. If the basis for your denial was improperly filing your claim, you need to resubmit your claim.

Draft a written appeal or demand letter to your insurance company demanding payment of your theft claim. If you suffered an auto theft loss, your insurance policy may cover a loss of your valuables up to a limited amount and may even provide replace your if stolen. Most insurance companies require that you file a police report before you file a theft claim.

Appeal your denial or resubmit your claim by following your insurance company's appeals procedures. Typically, you have a limited amount of time to appeal a denial. If you receive another denial, you may have further legal recourse by filing a lawsuit against your insurance company.

Tips & Warnings

  • Most insurance companies offer their customers the ability to appeal denials. Typically, insurance carriers require you to submit to a formal adjudication and arbitration process to appeal your claim denial. By agreeing to become a customer, you may have submitted to a binding arbitration process that requires you to file an appeal with a panel of arbitrators or insurance adjusters.
  • You may not have "standing" to file a lawsuit without first engaging in the arbitration process. Judicial or legal standing in the insurance context is the term for being able to file a private lawsuit without first appealing your denial and following the arbitration procedures.

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